Social Security Numbers

1040 INSTRUCTIONS

FUTURE DEVELOPMENTS

For the latest information about developments related to Form 1040 and its instructions, such as legislation enacted after they were published, go to www.irs.gov/form1040.

2012 Get a faster refund, reduce errors, and save paper. For more information on IRS e-file and Free File, see Options for e-filing your returns in these instructions or click on IRS e-file at IRS.gov.

Department of the Treasury Internal Revenue Service IRS.gov IRS

makes doing your taxes faster and easier.

is the fast, safe, and free way to prepare and e-file your taxes. See www.irs.gov/freefile.

MAILING YOUR RETURN

If you file a paper return, you may be mailing it to a different address this year.

For details on these and other changes, see What’s New in these instructions.

NOTE: THIS BOOKLET DOES NOT CONTAIN TAX FORMS

Including Instructions for Form 8949 and Schedules 8812, A, C, D, E, F, J, R, and SE

Cat. No. 11325E

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Table of Contents Contents Page Contents Page What's New . . . . . . . . . . . . . . . . . . . . . . . . 5

Filing Requirements . . . . . . . . . . . . . . . . . . 6 Do You Have To File? . . . . . . . . . . . . . . 6 When and Where Should You File? . . . . . 6 Where To Report Certain Items

From 2012 Forms W-2, 1097, 1098, and 1099 . . . . . . . . . . . . . . . . 10

Line Instructions for Form 1040 . . . . . . . . . 12 Name and Address . . . . . . . . . . . . . . . 12 Social Security Number (SSN) . . . . . . . 12 Presidential Election Campaign Fund

. . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Filing Status . . . . . . . . . . . . . . . . . . . 12 Exemptions . . . . . . . . . . . . . . . . . . . . 14 Income . . . . . . . . . . . . . . . . . . . . . . . 20 Adjusted Gross Income . . . . . . . . . . . . 30 Tax and Credits . . . . . . . . . . . . . . . . . 37 Other Taxes . . . . . . . . . . . . . . . . . . . . 45 Payments . . . . . . . . . . . . . . . . . . . . . 47

Refund . . . . . . . . . . . . . . . . . . . . . . . 73 Amount You Owe . . . . . . . . . . . . . . . . 75 Third Party Designee . . . . . . . . . . . . . . 77 Sign Your Return . . . . . . . . . . . . . . . . 77 Assemble Your Return . . . . . . . . . . . . 78

General Information . . . . . . . . . . . . . . . . . 92

Refund Information . . . . . . . . . . . . . . . . . . 96

What Is TeleTax? . . . . . . . . . . . . . . . . . . . 97

Calling the IRS . . . . . . . . . . . . . . . . . . . . 99

Disclosure, Privacy Act, and Paperwork Reduction Act Notice . . . . . . . . . . . . 101

Order Form for Forms and Publications . . . 103

Major Categories of Federal Income and Outlays for Fiscal Year 2011 . . . . . . .104

Index . . . . . . . . . . . . . . . . . . . . . . . . . . 106

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Department of the Treasury

Internal Revenue Service

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IRS e-file: It’s Safe. It’s Easy. It’s Time.

Volunteers are available in communities nationwide providing free tax assistance to low to moderate income (generally under $50,000 in adjusted gross income) and elderly taxpayers (age 60 and older). At selected sites, taxpayers can input and electronically �le their own tax return with the assistance of an IRS-certi�ed volunteer.

Why do 80% of Americans �le their taxes electronically?

• Security—The IRS uses the latest encryption technology to safeguard your information.

• Faster Refunds—Get your refund faster by e-�ling using direct deposit.

• It’s Free—through Free File.

• Flexible Payments—File early; pay by April 15.

• Quick Receipt—Get an acknowledgment that your return was received and accepted.

• Go Green—Reduce the amount of paper used.

IRS.gov is the gateway to all electronic services offered by the IRS, as well as the spot to download forms if you should choose to �le a paper return.

Options for e-filing your returns—safely, quickly, and easily.

If your adjusted gross income was $57,000 or less in 2012, you can use free tax software to prepare and e-�le your tax return. Earned more? Use Free File Fillable Forms.

• Greater Accuracy—Fewer errors mean faster processing.

Joining the 110 million Americans who already are using e-�le is easy. Just ask your paid or volunteer tax preparer, use commercial software, or use Free File. IRS e-�le is the safest, most secure way to transmit your tax return to the IRS. Since 1990, the IRS has processed more than 1 billion e-�led tax returns safely and securely. There’s no paper return to be lost or stolen.

Most tax return preparers are now required to use IRS e-�le. If you are asked if you want to e-�le, just give it a try. IRS e-�le is now the norm, not the exception. Most states also use electronic �ling.

Free File. This public-private partnership, between the IRS and tax software providers, makes approximately 20 popular commercial software products and e-�le available for free. Seventy percent of the nation’s taxpayers are eligible.

Just visit www.irs.gov/free�le for details. Free File combines all the bene�ts of e-�le and easy-to-use software at no cost. Guided questions will help ensure you get all the tax credits and deductions you are due. It’s fast, safe, and free.

You can review each provider’s eligibility rules or use an online tool to �nd those software products that match your situation. Some providers offer state tax return preparation either for a fee or for free. Free File also is available in English and Spanish.

Free File Fillable Forms. The IRS offers electronic versions of IRS paper forms that also can be e-�led for free. Free File Fillable Forms is best for people experienced in preparing their own tax returns. There are no income limitations. Free File Fillable Forms does basic math calculations. It supports only federal tax forms.

Free e-file Help Available Nationwide

Everyone Can Free File

See Free Tax Return Assistance near the end of these instructions for additional information or visit IRS.gov (Keyword: VITA) for a VITA/TCE site near you!

Make your tax payments electronically—it’s easy.

Do you have a balance due or owe estimated taxes? You can pay electronically either online or by phone, using your bank account or a credit or debit card. If you e-�le your return, you can also schedule your payment by Electronic Funds Withdrawal or by credit or debit card.

It’s convenient! You control when your payment is submitted and processed, and receive con�rmation of your payment.

It’s secure! The IRS uses the latest encryption technology to transmit your payment, and does not store your bank information.

It’s green! Electronic payments are paperless, so no check to write and no voucher to mail.

Visit www.irs.gov/e-pay for more information or to make a payment.

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The Taxpayer Advocate Service Is Here To Help You

What is the Taxpayer Advocate Service? The Taxpayer Advocate Service (TAS) is your voice at the IRS. Our job is to ensure that every taxpayer is treated fairly and that you know and understand your rights. What can TAS do for you? We can offer you free help with IRS problems that you can’t resolve on your own. We know the tax process can be confusing, but the worst thing you can do is nothing at all! TAS can help if you can’t resolve your tax problem and:

Your problem is causing financial difficulties for you, your family, or your business. You face (or your business is facing) an immediate threat of adverse action. You’ve tried repeatedly to contact the IRS but no one has responded, or the IRS hasn’t responded by the date promised.

If you qualify for our help, you'll be assigned to one advocate who’ll be with you at every turn and will do everything possible to resolve your problem.

TAS is an independent organization within the IRS. Our advocates know how to work with the IRS to get your problems resolved.

Our services are free and tailored to meet your needs. We have offices in every state, the District of Columbia, and Puerto Rico. Our online tax toolkit can help you understand your rights and options in dealing with the IRS. Go to

www.taxpayeradvocate.irs.gov/Individuals/Get-Tax-Help. How can you reach us? If you think TAS can help you, call your local advocate, whose number is in your phone book and on our website at www.irs.gov/ advocate. You can also call us toll-free at 1-877-777-4778. How else does TAS help taxpayers? TAS also works to resolve large-scale, systemic problems that affect many taxpayers. If you know of one of these broad issues, please report it to us through our Systemic Advocacy Management System at www.irs.gov/advocate.

Low Income Taxpayer Clinics Help Taxpayers

Low Income Taxpayer Clinics (LITCs) are independent from the IRS. Some serve individuals whose income is below a certain level and who need to resolve a tax problem. These clinics provide professional representation before the IRS or in court on audits, appeals, tax collection disputes, and other issues for free or for a small fee. Some clinics provide information about taxpayer rights and responsibilities in many different languages for individuals who speak English as a second language. For more information, and to find a clinic near you, read the LITC page on www.irs.gov/advocate or IRS Publication 4134, Low Income Taxpayer Clinic List. You can also get this publication at your local IRS office or by calling 1-800-829-3676.

Suggestions for Improving the IRS

Taxpayer Advocacy Panel

Have a suggestion for improving the IRS and do not know who to contact? The Taxpayer Advocacy Panel (TAP) is a diverse group of citizen volunteers who listen to taxpayers, identify taxpayers’ issues, and make suggestions for improving IRS service and customer satisfaction. The panel is demographically and geographically diverse, with at least one member from each state, the District of Columbia, and Puerto Rico. Contact TAP at www.improveirs.org or 1-888-912-1227 (toll-free).

The IRS Mission

Provide America's taxpayers top quality service by helping them understand and meet their tax responsibilities and by applying the tax law with integrity and fairness to all.

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What's New For information about any additional changes to the 2012 tax law or any other devel-opments affecting Form 1040 or its instructions, go to www.irs.gov/form1040. Tax benefits extended. Several tempo- rary tax benefits have been extended through 2013, including the following.

Deduction for educator expenses in figuring adjusted gross income (line 23).

Tuition and fees deduction (line 34).

Credit for nonbusiness energy property (line 52).

Election to deduct state and local sales taxes instead of state and local in- come taxes (Schedule A).

Deduction for mortgage insurance premiums (Schedule A).

Exclusion from income of qualified charitable distributions (see the instruc- tions for lines 15a and 15b).

Standard mileage rates. The 2012 rate for business use of your vehicle remains 551 2 cents a mile. The 2012 rate for use of your vehicle to get medical care or to move is decreased to 23 cents a mile. Roth IRAs. If you converted or rolled over an amount to a Roth IRA in 2010

and did not elect to report the taxable amount on your 2010 return, you gener- ally should have reported half of it on your 2011 return. Report the rest on your 2012 return. Report the amount that is taxable on your 2012 return on line 15b (for conversions from IRAs) or 16b (for rollovers from qualified retire- ment plans). See the instructions for lines 15a and 15b and lines 16a and 16b. Designated Roth accounts. If you rolled over an amount from a 401(k) or 403(b) plan to a designated Roth ac- count in 2010 and did not elect to report the taxable amount on your 2010 return, you generally should have reported half of it on your 2011 return. Report the rest on your 2012 return. See the instructions for lines 16a and 16b. Schedule 8812. Use Schedule 8812 (Form 1040A or 1040) to figure your additional child tax credit for 2012. Schedule 8812 is new for 2012. Form 8812 is no longer in use. See the instruc- tions for line 65.

Identity Protection Personal Identifi­ cation Number (IP PIN). If we sent you an IP PIN, see Identity Protection PIN after the instructions for line 77 to find out how to use it.

Expired tax benefits. The first-time homebuyer credit has expired. You can- not claim it on your 2012 return. That is why line 67 is shown as “Reserved.”

The District of Columbia first-time homebuyer credit cannot be claimed for homes bought after 2011.

The adoption credit stopped being re- fundable at the end of 2011. That is why line 71, box b, is shown as “Reserved.” You can claim the adoption credit on line 53. See the instructions for line 53. Mailing your return. If you are filing a paper return, you may be mailing it to a different address this year because the IRS has changed the filing location for several areas. See Where Do You File? at the end of these instructions.

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Filing Requirements

These rules apply to all U.S. citizens, regardless of where they live, and resident ali- ens.

Have you tried IRS e-file? It's the fastest way to get your refund and it's free if you are eligible. Visit IRS.gov for details.

Do You Have To File? Use Chart A, B, or C to see if you must file a return. U.S. citizens who lived in or had income from a U.S. possession should see Pub. 570. Residents of Puerto Rico can use TeleTax topic 901 to see if they must file.

Even if you do not otherwise have to file a return, you should file one to get a refund

of any federal income tax withheld. You should also file if you are eligible for any of the following credits.

Earned income credit. Additional child tax credit. American opportunity credit. Credit for federal tax on fuels. Refundable credit for prior year

minimum tax. Health coverage tax credit.

See Pub. 501 for details. Also see Pub. 501 if you do not have to file but received a Form 1099-B (or substitute statement). Exception for certain children under age 19 or full­time students. If certain conditions apply, you can elect to in- clude on your return the income of a child who was under age 19 at the end of 2012 or was a full-time student under age 24 at the end of 2012. To do so, use Form 8814. If you make this election, your child does not have to file a return. For details, use TeleTax topic 553 or see Form 8814.

A child born on January 1, 1989, is considered to be age 24 at the end of 2012. Do not use Form 8814 for such a child.

Resident aliens. These rules also apply if you were a resident alien. Also, you may qualify for certain tax treaty bene- fits. See Pub. 519 for details.

TIP

Nonresident aliens and dual­status ali­ ens. These rules also apply if you were a nonresident alien or a dual-status alien and both of the following apply.

You were married to a U.S. citizen or resident alien at the end of 2012.

You elected to be taxed as a resi- dent alien. See Pub. 519 for details.

Specific rules apply to deter- mine if you are a resident ali- en, nonresident alien, or du-

al-status alien. Most nonresident aliens and dual-status aliens have different fil- ing requirements and may have to file Form 1040NR or Form 1040NR-EZ. Pub. 519 discusses these requirements and other information to help aliens comply with U.S. tax law, including tax treaty benefits and special rules for stu- dents and scholars.

When and Where Should You File? File Form 1040 by April 15, 2013. If you file after this date, you may have to pay interest and penalties. See Interest and Penalties, later.

If you were serving in, or in support of, the U.S. Armed Forces in a designa- ted combat zone or contingency opera- tion, you may be able to file later. See Pub. 3 for details.

Filing instructions and addresses are at the end of these instructions.

What if You Cannot File on Time? You can get an automatic 6-month ex- tension if, no later than the date your re- turn is due, you file Form 4868. For de- tails, see Form 4868.

CAUTION !

An automatic 6-month exten- sion to file does not extend the time to pay your tax. If you do

not pay your tax by the original due date of your return, you will owe interest on the unpaid tax and may owe penalties. See Form 4868.

If you are a U.S. citizen or resident alien, you may qualify for an automatic extension of time to file without filing Form 4868. You qualify if, on the due date of your return, you meet one of the following conditions.

You live outside the United States and Puerto Rico and your main place of business or post of duty is outside the United States and Puerto Rico.

You are in military or naval service on duty outside the United States and Puerto Rico.

This extension gives you an extra 2 months to file and pay the tax, but inter- est will be charged from the original due date of the return on any unpaid tax. You must include a statement showing that you meet the requirements. If you are still unable to file your return by the end of the 2-month period, you can get an additional 4 months if, no later than June 17, 2013, you file Form 4868. This 4-month extension of time to file does not extend the time to pay your tax. See Form 4868.

Private Delivery Services You can use certain private delivery services designated by the IRS to meet the "timely mailing as timely filing/ paying" rule for tax returns and pay- ments. These private delivery services include only the following.

DHL Express (DHL): DHL Same Day Service.

Federal Express (FedEx): FedEx Priority Overnight, FedEx Standard Overnight, FedEx 2Day, FedEx Interna- tional Priority, and FedEx International First.

United Parcel Service (UPS): UPS Next Day Air, UPS Next Day Air Saver,

CAUTION !

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UPS 2nd Day Air, UPS 2nd Day Air A.M., UPS Worldwide Express Plus, and UPS Worldwide Express.

For the IRS mailing address to use if you are using a private delivery service,

go to IRS.gov and enter “private deliv- ery service” in the search box.

The private delivery service can tell you how to get written proof of the mail- ing date.

Chart A—For Most People

IF your filing status is . . . AND at the end of 2012 you were* . . .

THEN file a return if your gross income** was at least . . .

Single (see the instructions for line 1)

under 65 65 or older

$9,750 11,200

Married filing jointly*** (see the instructions for line 2)

under 65 (both spouses) 65 or older (one spouse) 65 or older (both spouses)

$19,500 20,650 21,800

Married filing separately (see the instructions for line 3) any age $3,800

Head of household (see the instructions for line 4)

under 65 65 or older

$12,500 13,950

Qualifying widow(er) with dependent child (see the instructions for line 5)

under 65 65 or older

$15,700 16,850

*If you were born on January 1, 1948, you are considered to be age 65 at the end of 2012. **Gross income means all income you received in the form of money, goods, property, and services that is not exempt from tax, including any income from sources outside the United States or from the sale of your main home (even if you can exclude part or all of it). Do not include any social security benefits unless (a) you are married filing a separate return and you lived with your spouse at any time in 2012 or (b) one-half of your social security benefits plus your other gross income and any tax-exempt interest is more than $25,000 ($32,000 if married filing jointly). If (a) or (b) applies, see the instructions for lines 20a and 20b to figure the taxable part of social security benefits you must include in gross income. Gross income includes gains, but not losses, reported on Form 8949 or Schedule D. Gross income from a business means, for example, the amount on Schedule C, line 7, or Schedule F, line 9. But, in figuring gross income, do not reduce your income by any losses, including any loss on Schedule C, line 7, or Schedule F, line 9.

***If you did not live with your spouse at the end of 2012 (or on the date your spouse died) and your gross income was at least $3,800, you must file a return regardless of your age.

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Chart B—For Children and Other Dependents (See the instructions for line 6c to find out if someone can claim you as a dependent.) If your parent (or someone else) can claim you as a dependent, use this chart to see if you must file a return. In this chart, unearned income includes taxable interest, ordinary dividends, and capital gain distributions. It also includes unemployment compensation, taxable social security benefits, pensions, annuities, and distributions of unearned income from a trust. Earned income includes salaries, wages, tips, professional fees, and taxable scholarship and fellowship grants. Gross income is the total of your unearned and earned income.

Single dependents. Were you either age 65 or older or blind?

No. You must file a return if any of the following apply. Your unearned income was over $950. Your earned income was over $5,950. Your gross income was more than the larger of—

$950, or Your earned income (up to $5,650) plus $300.

Yes. You must file a return if any of the following apply. Your unearned income was over $2,400 ($3,850 if 65 or older and blind). Your earned income was over $7,400 ($8,850 if 65 or older and blind). Your gross income was more than the larger of—

$2,400 ($3,850 if 65 or older and blind), or Your earned income (up to $5,650) plus $1,750 ($3,200 if 65 or older and blind).

Married dependents. Were you either age 65 or older or blind?

No. You must file a return if any of the following apply. Your unearned income was over $950. Your earned income was over $5,950. Your gross income was at least $5 and your spouse files a separate return and itemizes deductions. Your gross income was more than the larger of—

$950, or Your earned income (up to $5,650) plus $300.

Yes. You must file a return if any of the following apply. Your unearned income was over $2,100 ($3,250 if 65 or older and blind). Your earned income was over $7,100 ($8,250 if 65 or older and blind). Your gross income was at least $5 and your spouse files a separate return and itemizes deductions. Your gross income was more than the larger of—

$2,100 ($3,250 if 65 or older and blind), or Your earned income (up to $5,650) plus $1,450 ($2,600 if 65 or older and blind).

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Chart C—Other Situations When You Must File You must file a return if any of the four conditions below apply for 2012.

1. You owe any special taxes, including any of the following. a. Alternative minimum tax. b. Additional tax on a qualified plan, including an individual retirement arrangement (IRA), or other tax-favored account.

But if you are filing a return only because you owe this tax, you can file Form 5329 by itself. c. Household employment taxes. But if you are filing a return only because you owe this tax, you can file Schedule H by

itself. d. Social security and Medicare tax on tips you did not report to your employer or on wages you received from an employer

who did not withhold these taxes. e. Recapture of first-time homebuyer credit. See the instructions for line 59b. f. Write-in taxes, including uncollected social security and Medicare or RRTA tax on tips you reported to your employer or

on group-term life insurance and additional taxes on health savings accounts. See the instructions for line 60. g. Recapture taxes. See the instructions for line 44 and line 60.

2. You (or your spouse, if filing jointly) received HSA, Archer MSA, or Medicare Advantage MSA distributions.

3. You had net earnings from self-employment of at least $400.

4. You had wages of $108.28 or more from a church or qualified church-controlled organization that is exempt from employer social security and Medicare taxes.

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Where To Report Certain Items From 2012 Forms W-2, 1097, 1098, and 1099 IRS e-file takes the guesswork out of preparing your return. You may also be eligible to use Free File to file your federal

income tax return. Visit www.irs.gov/efile for details. If any federal income tax withheld is shown on these forms, include the tax withheld on Form 1040, line 62. If any state or local income tax withheld is shown on these forms and you deduct state and local income taxes on Schedule A, line 5, include the tax withheld in your deduction on that line.

Form Item and Box in Which It Should Appear Where To Report W-2 Wages, tips, other compensation (box 1) Form 1040, line 7

Allocated tips (box 8) See Wages, Salaries, Tips, etc. Dependent care benefits (box 10) Form 2441, Part III Adoption benefits (box 12, code T) Form 8839, line 16 Employer contributions to an

Archer MSA (box 12, code R) Form 8853, line 1

Employer contributions to a health savings account (box 12, code W)

Form 8889, line 9

Uncollected social security and Medicare or RRTA tax (box 12, code A, B, M, or N)

See the instructions for Form 1040, line 60

W-2G Gambling winnings (box 1) Form 1040, line 21 (Schedule C or C-EZ for professional gamblers)

1097-BTC Bond tax credit See Form 8912 and its instructions

1098 Mortgage interest (box 1) Points (box 2) Schedule A, line 10, but first see the instructions on Form 1098*

Refund of overpaid interest (box 3) Form 1040, line 21, but first see the instructions on Form 1098* Mortgage insurance premiums See the instructions for Schedule A, line 13*

1098-C Contributions of motor vehicles, boats, and airplanes Schedule A, line 17

1098-E Student loan interest (box 1) See the instructions for Form 1040, line 33*

1098-MA Homeowner mortgage payments (box 3) Schedule A, but first see the instructions on Form 1098-MA

1098-T Qualified tuition and related expenses (box 1)

See the instructions for Form 1040, line 34, or Form 1040, line 49; but first see the instructions on Form 1098-T*

1099-A Acquisition or abandonment of secured property See Pub. 4681

1099-B Sales price of stocks, bonds, etc. (box 2a), cost or other basis (box 3), and wash sale loss disallowed (box 5)

Form 8949, but first see the Instructions for Form 8949

Bartering (box 7) See Pub. 525 Aggregate profit or (loss) on contracts (box 12) Form 6781, line 1

1099-C Canceled debt (box 2) See Pub. 4681

1099-DIV Total ordinary dividends (box 1a) Form 1040, line 9a Qualified dividends (box 1b) See the instructions for Form 1040, line 9b Total capital gain distributions (box 2a) Form 1040, line 13, or, if required, Schedule D, line 13 Unrecaptured section 1250 gain (box 2b) See the instructions for Schedule D, line 19 Section 1202 gain (box 2c) See Exclusion of Gain on Qualified Small Business (QSB) Stock in the instructions

for Schedule D Collectibles (28%) gain (box 2d) See the instructions for Schedule D, line 18 Nondividend distributions (box 3) See the instructions for Form 1040, line 9a Investment expenses (box 5) Schedule A, line 23 Foreign tax paid (box 6) Form 1040, line 47, or Schedule A, line 8; but first see the instructions for line 47 Exempt-interest dividends (box 10) Form 1040, line 8b Specified private activity bond interest dividends

(box 11) Form 6251, line 12

*If the item relates to an activity for which you are required to file Schedule C, C-EZ, E, or F or Form 4835, report the taxable or deductible amount allocable to the activity on that schedule or form instead.

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Form Item and Box in Which It Should Appear Where To Report 1099-G Unemployment compensation (box 1) See the instructions for Form 1040, line 19

State or local income tax refunds, credits, or offsets (box 2)

See the instructions for Form 1040, line 10, and if box 8 on Form 1099-G is checked, see the box 8 instructions

ATAA/RTAA payments (box 5) Form 1040, line 21 Taxable grants (box 6) Form 1040, line 21* Agriculture payments (box 7) See the Instructions for Schedule F or Pub. 225* Market gain (box 9) See the Instructions for Schedule F

1099-INT Interest income (box 1) See the instructions for Form 1040, line 8a Early withdrawal penalty (box 2) Form 1040, line 30 Interest on U.S. savings bonds and

Treasury obligations (box 3) See the instructions for Form 1040, line 8a

Investment expenses (box 5) Schedule A, line 23 Foreign tax paid (box 6) Form 1040, line 47, or Schedule A, line 8; but first see the instructions for line 47 Tax-exempt interest (box 8) Form 1040, line 8b Specified private activity bond interest (box 9) Form 6251, line 12

1099-K Payment card and third party network transactions

Schedule C, C-EZ, E, or F

1099-LTC Long-term care and accelerated death benefits See Pub. 525 and the Instructions for Form 8853

1099-MISC Rents (box 1) See the Instructions for Schedule E* Royalties (box 2) See the Instructions for Schedule E* (for timber, coal, and iron ore royalties, see

Pub. 544)* Other income (box 3) Form 1040, line 21* Nonemployee compensation (box 7) Schedule C, C-EZ, or F; but if you were not self-employed, see the instructions on

Form 1099-MISC Excess golden parachute payments (box 13) See the instructions for Form 1040, line 60 Other (boxes 5, 6, 8, 9, 10, 14, and 15b) See the instructions on Form 1099-MISC

1099-OID Original issue discount (box 1) Other periodic interest (box 2) See the instructions on Form 1099-OID

Early withdrawal penalty (box 3) Form 1040, line 30 Original issue discount on U.S. Treasury obligations

(box 6) See the instructions on Form 1099-OID

Investment expenses (box 7) Schedule A, line 23

1099-PATR Patronage dividends and other distributions from a cooperative (boxes 1, 2, 3, and 5)

Schedule C, C-EZ, or F or Form 4835; but first see the instructions on Form 1099-PATR

Domestic production activities deduction (box 6) Form 8903, line 23 Credits and other deductions (boxes 7, 8, and 10) See the instructions on Form 1099-PATR Patron's AMT adjustment (box 9) Form 6251, line 27

1099-Q Qualified education program payments See the instructions for Form 1040, line 21

1099-R Distributions from IRAs** See the instructions for Form 1040, lines 15a and 15b Distributions from pensions, annuities, etc. See the instructions for Form 1040, lines 16a and 16b Capital gain (box 3) See the instructions on Form 1099-R

1099-S Gross proceeds from real estate transactions (box 2)

Form 4797, Form 6252, Form 8824, or Form 8949

Buyer's part of real estate tax (box 5) See the instructions for Schedule A, line 6*

1099-SA Distributions from health savings accounts (HSAs) Form 8889, line 14a Distributions from MSAs*** Form 8853

*If the item relates to an activity for which you are required to file Schedule C, C-EZ, E, or F or Form 4835, report the taxable or deductible amount allocable to the activity on that schedule or form instead.

**This includes distributions from Roth, SEP, and SIMPLE IRAs.

***This includes distributions from Archer and Medicare Advantage MSAs.

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Line Instructions for Form 1040

IRS e-file takes the guesswork out of preparing your return. You may also be eligible to use Free File to file your federal income tax return.

Visit www.irs.gov/efile for details.

Section references are to the Internal Revenue Code.

Name and Address Print or type the information in the spaces provided. If you are married fil- ing a separate return, enter your spouse's name on line 3 instead of below your name.

If you filed a joint return for 2011 and you are filing a joint return for 2012 with the same

spouse, be sure to enter your names and SSNs in the same order as on your 2011 return.

Name Change If you changed your name because of marriage, divorce, etc., be sure to report the change to the Social Security Ad- ministration (SSA) before filing your re- turn. This prevents delays in processing your return and issuing refunds. It also safeguards your future social security benefits.

Address Change If you plan to move after filing your re- turn, use Form 8822 to notify the IRS of your new address.

P.O. Box Enter your box number only if your post office does not deliver mail to your home.

Foreign Address If you have a foreign address, enter the city name on the appropriate line. Do not enter any other information on that line, but also complete the spaces below that line. Do not abbreviate the country name. Follow the country's practice for entering the postal code and the name of the province, county, or state.

Death of a Taxpayer See Death of a Taxpayer under General Information, later.

TIP

Social Security Number (SSN) An incorrect or missing SSN can in- crease your tax, reduce your refund, or delay your refund. To apply for an SSN, fill in Form SS-5 and return it, along with the appropriate evidence docu- ments, to the Social Security Adminis- tration (SSA). You can get Form SS-5 online at www.socialsecurity.gov, from your local SSA office, or by calling the SSA at 1-800-772-1213. It usually takes about 2 weeks to get an SSN once the SSA has all the evidence and informa- tion it needs.

Check that both the name and SSN on your Forms 1040, W-2, and 1099 agree with your social security card. If they do not, certain deductions and cred- its on your Form 1040 may be reduced or disallowed and you may not receive credit for your social security earnings. If your Form W-2 shows an incorrect SSN or name, notify your employer or the form-issuing agent as soon as possi- ble to make sure your earnings are credi- ted to your social security record. If the name or SSN on your social security card is incorrect, call the SSA.

IRS Individual Taxpayer Identification Numbers (ITINs) for Aliens If you are a nonresident or resident alien and you do not have and are not eligible to get an SSN, you must apply for an ITIN. For details on how to do so, see Form W-7 and its instructions. It takes 6 to 10 weeks to get an ITIN.

If you already have an ITIN, enter it wherever your SSN is requested on your tax return.

Note. An ITIN is for tax use only. It does not entitle you to social security

benefits or change your employment or immigration status under U.S. law.

Nonresident Alien Spouse If your spouse is a nonresident alien, he or she must have either an SSN or an ITIN if:

You file a joint return, You file a separate return and

claim an exemption for your spouse, or Your spouse is filing a separate re-

turn.

Presidential Election Campaign Fund This fund helps pay for Presidential election campaigns. The fund reduces candidates' dependence on large contri- butions from individuals and groups and places candidates on an equal financial footing in the general election. If you want $3 to go to this fund, check the box. If you are filing a joint return, your spouse can also have $3 go to the fund. If you check a box, your tax or refund will not change.

Filing Status Check only the filing status that applies to you. The ones that will usually give you the lowest tax are listed last.

Married filing separately. Single. Head of household. Married filing jointly or qualifying

widow(er) with dependent child.

More than one filing status can apply to you. You can choose the one that will give you the

lowest tax.

TIP

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2012 Form 1040—Lines 1 Through 4

Line 1 Single You can check the box on line 1 if any of the following was true on December 31, 2012.

You were never married. You were legally separated accord-

ing to your state law under a decree of divorce or separate maintenance. But if, at the end of 2012, your divorce was not final (an interlocutory decree), you are considered married and cannot check the box on line 1.

You were widowed before January 1, 2012, and did not remarry before the end of 2012. But if you have a depend- ent child, you may be able to use the qualifying widow(er) filing status. See the instructions for line 5.

Line 2 Married Filing Jointly You can check the box on line 2 if any of the following apply.

You were married at the end of 2012, even if you did not live with your spouse at the end of 2012.

Your spouse died in 2012 and you did not remarry in 2012.

You were married at the end of 2012, and your spouse died in 2013 be- fore filing a 2012 return.

For federal tax purposes, a marriage means only a legal union between a man and a woman as husband and wife, and the word “spouse” means a person of the opposite sex who is a husband or a wife. A husband and wife filing jointly report their combined income and deduct their combined allowable expenses on one re- turn. They can file a joint return even if only one had income or if they did not live together all year. However, both persons must sign the return. Once you file a joint return, you cannot choose to file separate returns for that year after the due date of the return. Joint and several tax liability. If you file a joint return, both you and your spouse are generally responsible for the tax and interest or penalties due on the return. This means that if one spouse does not pay the tax due, the other may have to. Or, if one spouse does not re- port the correct tax, both spouses may be

responsible for any additional taxes as- sessed by the IRS. You may want to file separately if:

You believe your spouse is not re- porting all of his or her income, or

You do not want to be responsible for any taxes due if your spouse does not have enough tax withheld or does not pay enough estimated tax. See the instructions for line 3. Also see Innocent Spouse Relief under General Information, later.

Nonresident aliens and dual­status ali­ ens. Generally, a husband and wife can- not file a joint return if either spouse is a nonresident alien at any time during the year. However, if you were a nonresi- dent alien or a dual-status alien and were married to a U.S. citizen or resident ali- en at the end of 2012, you can elect to be treated as a resident alien and file a joint return. See Pub. 519 for details.

Line 3 Married Filing Separately If you are married and file a separate re- turn, you generally report only your own income, exemptions, deductions, and credits. Generally, you are responsible only for the tax on your own income. Different rules apply to people in com- munity property states; see Pub. 555.

However, you will usually pay more tax than if you use another filing status for which you qualify. Also, if you file a separate return, you cannot take the stu- dent loan interest deduction, the tuition and fees deduction, the education cred- its, or the earned income credit. You al- so cannot take the standard deduction if your spouse itemizes deductions.

Be sure to enter your spouse's SSN or ITIN on Form 1040. If your spouse does not have and is not required to have an SSN or ITIN, enter “NRA.”

You may be able to file as head of household if you had a child living with you and you lived

apart from your spouse during the last 6 months of 2012. See Married persons who live apart.

TIP

Line 4 Head of Household This filing status is for unmarried indi- viduals who provide a home for certain other persons. You are considered un- married for this purpose if any of the following applies.

You were legally separated accord- ing to your state law under a decree of divorce or separate maintenance at the end of 2012. But if, at the end of 2012, your divorce was not final (an interlocu- tory decree), you are considered mar- ried.

You are married but lived apart from your spouse for the last 6 months of 2012 and you meet the other rules un- der Married persons who live apart.

You are married to a nonresident alien at any time during the year and you do not choose to treat him or her as a resident alien. Check the box on line 4 only if you are unmarried (or considered unmarried) and either Test 1 or Test 2 applies. Test 1. You paid over half the cost of keeping up a home that was the main home for all of 2012 of your parent whom you can claim as a dependent, ex- cept under a multiple support agreement (see the line 6c instructions). Your pa- rent did not have to live with you. Test 2. You paid over half the cost of keeping up a home in which you lived and in which one of the following also lived for more than half of the year (if half or less, see Exception to time lived with you).

1. Any person whom you can claim as a dependent. But do not include:

a. Your child whom you claim as your dependent because of the rule for Children of divorced or separated pa- rents in the line 6c instructions,

b. Any person who is your depend- ent only because he or she lived with you for all of 2012, or

c. Any person you claimed as a de- pendent under a multiple support agree- ment. See the line 6c instructions.

2. Your unmarried qualifying child who is not your dependent.

3. Your married qualifying child who is not your dependent only because

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you can be claimed as a dependent on someone else's 2012 return.

4. Your qualifying child who, even though you are the custodial parent, is not your dependent because of the rule for Children of divorced or separated parents in the line 6c instructions.

If the child is not your dependent, en- ter the child's name on line 4. If you do not enter the name, it will take us longer to process your return.

Qualifying child. To find out if some- one is your qualifying child, see Step 1 of the line 6c instructions. Dependent. To find out if someone is your dependent, see the instructions for line 6c. Exception to time lived with you. Temporary absences by you or the other person for special circumstances, such as school, vacation, business, medical care, military service, or detention in a juvenile facility, count as time lived in the home. Also see Kidnapped child in the line 6c instructions, if applicable.

If the person for whom you kept up a home was born or died in 2012, you can still file as head of household as long as the home was that person's main home for more than half of the part of the year he or she was alive. Keeping up a home. To find out what is included in the cost of keeping up a home, see Pub. 501.

If you used payments you received under Temporary Assistance for Needy Families (TANF) or other public assis- tance programs to pay part of the cost of keeping up your home, you cannot count them as money you paid. However, you must include them in the total cost of keeping up your home to figure if you paid over half the cost.

Married persons who live apart. Even if you were not divorced or legally sepa- rated at the end of 2012, you are consid- ered unmarried if all of the following apply.

You lived apart from your spouse for the last 6 months of 2012. Tempora- ry absences for special circumstances, such as for business, medical care, school, or military service, count as time lived in the home.

You file a separate return from your spouse.

You paid over half the cost of keeping up your home for 2012.

Your home was the main home of your child, stepchild, or foster child for more than half of 2012 (if half or less, see Exception to time lived with you, earlier).

You can claim this child as your dependent or could claim the child ex- cept that the child's other parent can claim him or her under the rule for Chil- dren of divorced or separated parents in the line 6c instructions.

Adopted child. An adopted child is always treated as your own child. An adopted child includes a child lawfully placed with you for legal adoption.

Foster child. A foster child is any child placed with you by an authorized placement agency or by judgment, de- cree, or other order of any court of com- petent jurisdiction.

Line 5 Qualifying Widow(er) With Dependent Child You can check the box on line 5 and use joint return tax rates for 2012 if all of the following apply.

Your spouse died in 2010 or 2011 and you did not remarry before the end of 2012.

You have a child or stepchild whom you claim as a dependent. This does not include a foster child.

This child lived in your home for all of 2012. If the child did not live with you for the required time, see Exception to time lived with you, later.

You paid over half the cost of keeping up your home.

You could have filed a joint return with your spouse the year he or she died, even if you did not actually do so.

If your spouse died in 2012, you can- not file as qualifying widow(er) with de- pendent child. Instead, see the instruc- tions for line 2. Adopted child. An adopted child is al- ways treated as your own child. An adopted child includes a child lawfully placed with you for legal adoption. Dependent. To find out if someone is your dependent, see the instructions for line 6c.

Exception to time lived with you. Temporary absences by you or the child for special circumstances, such as school, vacation, business, medical care, military service, or detention in a juve- nile facility, count as time lived in the home. Also see Kidnapped child in the line 6c instructions, if applicable.

A child is considered to have lived with you for all of 2012 if the child was born or died in 2012 and your home was the child's home for the entire time he or she was alive. Keeping up a home. To find out what is included in the cost of keeping up a home, see Pub. 501.

If you used payments you received under Temporary Assistance for Needy Families (TANF) or other public assis- tance programs to pay part of the cost of keeping up your home, you cannot count them as money you paid. However, you must include them in the total cost of keeping up your home to figure if you paid over half the cost.

Exemptions You can deduct $3,800 on line 42 for each exemption you can take.

Line 6b Spouse Check the box on line 6b if either of the following applies.

1. Your filing status is married filing jointly and your spouse cannot be claim- ed as a dependent on another person's return.

2. You were married at the end of 2012, your filing status is married filing separately or head of household, and both of the following apply.

a. Your spouse had no income and is not filing a return.

b. Your spouse cannot be claimed as a dependent on another person's return.

If your filing status is head of house- hold and you check the box on line 6b, enter the name of your spouse on the dotted line next to line 6b. Also, enter your spouse's social security number in the space provided at the top of your re- turn. If you became divorced or legally

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separated during 2012, you cannot take an exemption for your former spouse.

Death of your spouse. If your spouse died in 2012 and you did not remarry by

the end of 2012, check the box on line 6b if you could have taken an ex- emption for your spouse on the date of death. For other filing instructions, see

Death of a Taxpayer under General In- formation, later.

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2012 Form 1040—Line 6c

Line 6c—Dependents Dependents and Qualifying Child for Child Tax Credit Follow the steps below to find out if a person qualifies as your dependent, qualifies you to take the child tax credit, or both. If you have more than four dependents, check the box to the left of line 6c and include a statement showing the information re- quired in columns (1) through (4).

Do You Have a Qualifying Child?

A qualifying child is a child who is your...

Son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, half brother, half sister, or a descendant of any of them (for

example, your grandchild, niece, or nephew)

AND

was ...

Under age 19 at the end of 2012 and younger than you (or your spouse, if filing jointly)

or

Under age 24 at the end of 2012, a student (defined later), and younger than you (or your spouse, if filing jointly)

or Any age and permanently and totally disabled (defined later)

AND

Who did not provide over half of his or her own support for 2012 (see Pub. 501)

AND

Who is not filing a joint return for 2012 or is filing a joint return for 2012 only to claim a refund of withheld

income tax or estimated tax paid (see Pub. 501 for details and examples)

AND

Who lived with you for more than half of 2012. If the child did not live with you for the required time, see Exception to time lived with you,

later.

CAUTION !

If the child meets the conditions to be a qualifying child of any other person (other than your spouse if filing jointly) for 2012, see Qualifying child of more than one person, later.

Step 1

1. Do you have a child who meets the conditions to be your qualifying child?

Yes. Go to Step 2. No. Go to Step 4.

Is Your Qualifying Child Your Dependent?

1. Was the child a U.S. citizen, U.S. national, U.S. resident alien, or a resident of Canada or Mexico? (See Pub. 519 for the definition of a U.S. national or U.S. resident alien. If the child was adopted, see Exception to citizen test, later.)

Yes. Continue �

No. STOP You cannot claim this child as a dependent. Go to Form 1040, line 7.

2. Was the child married? Yes. See Married person, later.

No. Continue �

3. Could you, or your spouse if filing jointly, be claimed as a dependent on someone else's 2012 tax return? See Steps 1, 2, and 4.

Yes. You cannot claim any dependents. Go to Form 1040, line 7.

No. You can claim this child as a dependent. Complete Form 1040, line 6c, columns (1) through (3) for this child. Then, go to Step 3.

Does Your Qualifying Child Qualify You for the Child Tax Credit?

1. Was the child under age 17 at the end of 2012? Yes. Continue

� No. STOP This child is not a qualifying child for the child tax credit. Go to Form 1040, line 7.

2. Was the child a U.S. citizen, U.S. national, or U.S. resident alien? (See Pub. 519 for the definition of a U.S. national or U.S. resident alien. If the child was adopted, see Exception to citizen test, later.)

Yes. This child is a qualifying child for the child tax credit. Check the box on Form 1040, line 6c, column (4).

No. STOP This child is not a qualifying child for the child tax credit. Go to Form 1040, line 7.

Step 2

Step 3

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2012 Form 1040—Line 6c

Is Your Qualifying Relative Your Dependent?

A qualifying relative is a person who is your...

Son, daughter, stepchild, foster child, or a descendant of any of them (for example, your grandchild)

or Brother, sister, half brother, half sister, or a son or daughter

of any of them (for example, your niece or nephew) or

Father, mother, or an ancestor or sibling of either of them (for example, your grandmother, grandfather, aunt, or uncle)

or Stepbrother, stepsister, stepfather, stepmother, son-in-law,

daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law

or

Any other person (other than your spouse) who lived with you all year as a member of your household if your

relationship did not violate local law. If the person did not live with you for the required time, see Exception to time

lived with you, later

AND

Who was not a qualifying child (see Step 1) of any taxpayer for 2012. For this purpose, a person is not a taxpayer if he or she is not required to file a U.S. income tax return and either

does not file such a return or files only to get a refund of withheld income tax or estimated tax paid. See Pub. 501 for

details and examples

AND

Who had gross income of less than $3,800 in 2012. If the person was permanently and totally disabled, see Exception

to gross income test, later

AND

For whom you provided over half of his or her support in 2012. But see Children of divorced or separated parents, Multiple support agreements, and Kidnapped child, later.

Step 4 1. Does any person meet the conditions to be your qualifying relative? Yes. Continue

� No. STOP Go to Form 1040, line 7.

2. Was your qualifying relative a U.S. citizen, U.S. national, U.S. resident alien, or a resident of Canada or Mexico? (See Pub. 519 for the definition of a U.S. national or U.S. resident alien. If your qualifying relative was adopted, see Exception to citizen test, later.)

Yes. Continue �

No. STOP You cannot claim this person as a dependent. Go to Form 1040, line 7.

3. Was your qualifying relative married? Yes. See Married person, later.

No. Continue �

4. Could you, or your spouse if filing jointly, be claimed as a dependent on someone else's 2012 tax return? See Steps 1, 2, and 4.

Yes. STOP You cannot claim any dependents. Go to Form 1040, line 7.

No. You can claim this person as a dependent. Complete Form 1040, line 6c, columns (1) through (3). Do not check the box on Form 1040, line 6c, column (4).

Definitions and Special Rules Adopted child. An adopted child is always treated as your own child. An adopted child includes a child lawfully placed with you for legal adoption. Adoption taxpayer identification numbers (ATINs). If you have a dependent who was placed with you for legal adoption and you do not know his or her SSN, you must get an ATIN for the dependent from the IRS. See Form W-7A for details. If the dependent is not a U.S. citizen or resident alien, apply for an ITIN instead, using Form W-7.

Children of divorced or separated parents. A child will be treated as the qualifying child or qualifying relative of his or her noncustodial parent (defined later) if all of the following condi- tions apply.

1. The parents are divorced, legally separated, separated un- der a written separation agreement, or lived apart at all times during the last 6 months of 2012 (whether or not they are or were married).

2. The child received over half of his or her support for 2012 from the parents (and the rules on Multiple support agree- ments, later, do not apply). Support of a child received from a parent's spouse is treated as provided by the parent.

3. The child is in custody of one or both of the parents for more than half of 2012.

4. Either of the following applies.

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2012 Form 1040—Line 6c

a. The custodial parent signs Form 8332 or a substantially similar statement that he or she will not claim the child as a de- pendent for 2012, and the noncustodial parent includes a copy of the form or statement with his or her return. If the divorce de- cree or separation agreement went into effect after 1984 and be- fore 2009, the noncustodial parent may be able to include cer- tain pages from the decree or agreement instead of Form 8332. See Post-1984 and pre-2009 decree or agreement and Post-2008 decree or agreement.

b. A pre-1985 decree of divorce or separate maintenance or written separation agreement between the parents provides that the noncustodial parent can claim the child as a dependent, and the noncustodial parent provides at least $600 for support of the child during 2012.

If conditions (1) through (4) apply, only the noncustodial pa- rent can claim the child for purposes of the dependency exemp- tion (line 6c) and the child tax credits (lines 51 and 65). Howev- er, this special rule does not apply to head of household filing status, the credit for child and dependent care expenses, the ex- clusion for dependent care benefits, the earned income credit, or the health coverage tax credit. See Pub. 501 for details.

Custodial and noncustodial parents. The custodial parent is the parent with whom the child lived for the greater number of nights in 2012. The noncustodial parent is the other parent. If the child was with each parent for an equal number of nights, the custodial parent is the parent with the higher adjusted gross income. See Pub. 501 for an exception for a parent who works at night, rules for a child who is emancipated under state law, and other details.

Post-1984 and pre-2009 decree or agreement. The decree or agreement must state all three of the following.

1. The noncustodial parent can claim the child as a depend- ent without regard to any condition, such as payment of support.

2. The other parent will not claim the child as a dependent. 3. The years for which the claim is released.

The noncustodial parent must include all of the following pa- ges from the decree or agreement.

Cover page (include the other parent's SSN on that page). The pages that include all the information identified in (1)

through (3) above. Signature page with the other parent's signature and date of

agreement.

You must include the required information even if you filed it with your return in an earlier year.

Post-2008 decree or agreement. If the divorce decree or separation agreement went into effect after 2008, the noncusto- dial parent cannot include pages from the decree or agreement instead of Form 8332. The custodial parent must sign either Form 8332 or a substantially similar statement the only purpose of which is to release the custodial parent's claim to an exemp- tion for a child, and the noncustodial parent must include a copy with his or her return. The form or statement must release the custodial parent's claim to the child without any conditions. For

CAUTION !

example, the release must not depend on the noncustodial pa- rent paying support.

Release of exemption revoked. A custodial parent who has revoked his or her previous release of a claim to exemption for a child must include a copy of the revocation with his or her re- turn. For details, see Form 8332.

Exception to citizen test. If you are a U.S. citizen or U.S. na- tional and your adopted child lived with you all year as a mem- ber of your household, that child meets the requirement to be a U.S. citizen in Step 2, question 1; Step 3, question 2; and Step 4, question 2. Exception to gross income test. If your relative (including a person who lived with you all year as a member of your house- hold) is permanently and totally disabled (defined later), certain income for services performed at a sheltered workshop may be excluded for this test. For details, see Pub. 501. Exception to time lived with you. Temporary absences by you or the other person for special circumstances, such as school, vacation, business, medical care, military service, or detention in a juvenile facility, count as time the person lived with you. Also see Children of divorced or separated parents, earlier, or Kidnapped child, later.

A person is considered to have lived with you for all of 2012 if the person was born or died in 2012 and your home was this person's home for the entire time he or she was alive in 2012.

If the person meets all other requirements to be your qualify- ing child but was born or died in 2012, the person is considered to have lived with you for more than half of 2012 if your home was this person's home for more than half the time he or she was alive in 2012.

Foster child. A foster child is any child placed with you by an authorized placement agency or by judgment, decree, or other order of any court of competent jurisdiction.

Kidnapped child. If your child is presumed by law enforce- ment authorities to have been kidnapped by someone who is not a family member, you may be able to take the child into account in determining your eligibility for head of household or qualify- ing widow(er) filing status, the dependency exemption, the child tax credit, and the earned income credit (EIC). For details, see Pub. 501 (Pub. 596 for the EIC).

Married person. If the person is married and files a joint re- turn, you cannot claim that person as your dependent. Go to Form 1040, line 7. However, if the person is married but does not file a joint return or files a joint return only to claim a re- fund of withheld income tax or estimated tax paid, you may be able to claim him or her as a dependent. (See Pub. 501 for de- tails and examples.) Go to Step 2, question 3 (for a qualifying child) or Step 4, question 4 (for a qualifying relative). Multiple support agreements. If no one person contributed over half of the support of your relative (or a person who lived with you all year as a member of your household) but you and another person(s) provided more than half of your relative's support, special rules may apply that would treat you as having provided over half of the support. For details, see Pub. 501.

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2012 Form 1040—Line 6c

Permanently and totally disabled. A person is permanently and totally disabled if, at any time in 2012, the person cannot engage in any substantial gainful activity because of a physical or mental condition and a doctor has determined that this condi- tion has lasted or can be expected to last continuously for at least a year or can be expected to lead to death.

Qualifying child of more than one person. Even if a child meets the conditions to be the qualifying child of more than one person, only one person can claim the child as a qualifying child for all of the following tax benefits, unless the special rule for Children of divorced or separated parents, described earlier, applies.

1. Dependency exemption (line 6c). 2. Child tax credits (lines 51 and 65). 3. Head of household filing status (line 4). 4. Credit for child and dependent care expenses (line 48). 5. Exclusion for dependent care benefits (Form 2441, Part

III). 6. Earned income credit (lines 64a and 64b).

No other person can take any of the six tax benefits listed above unless he or she has a different qualifying child. If you and any other person can claim the child as a qualifying child, the fol- lowing rules apply.

If only one of the persons is the child's parent, the child is treated as the qualifying child of the parent.

If the parents do not file a joint return together but both pa- rents claim the child as a qualifying child, the IRS will treat the child as the qualifying child of the parent with whom the child lived for the longer period of time in 2012. If the child lived with each parent for the same amount of time, the IRS will treat the child as the qualifying child of the parent who had the high- er adjusted gross income (AGI) for 2012.

If no parent can claim the child as a qualifying child, the child is treated as the qualifying child of the person who had the highest AGI for 2012.

If a parent can claim the child as a qualifying child but no parent does so claim the child, the child is treated as the qualify- ing child of the person who had the highest AGI for 2012, but only if that person's AGI is higher than the highest AGI of any parent of the child who can claim the child.

Example. Your daughter meets the conditions to be a quali- fying child for both you and your mother. Your daughter does not meet the conditions to be a qualifying child of any other person, including her other parent. Under the rules just descri- bed, you can claim your daughter as a qualifying child for all of the six tax benefits just listed for which you otherwise qualify. Your mother cannot claim any of those six tax benefits unless she has a different qualifying child. However, if your mother's AGI is higher than yours and you do not claim your daughter as a qualifying child, your daughter is the qualifying child of your mother.

For more details and examples, see Pub. 501. If you will be claiming the child as a qualifying child, go to

Step 2. Otherwise, stop; you cannot claim any benefits based on this child. Go to Form 1040, line 7.

Social security number. You must enter each dependent's so- cial security number (SSN). Be sure the name and SSN entered agree with the dependent's social security card. Otherwise, at the time we process your return, we may disallow the exemp- tion claimed for the dependent and reduce or disallow any other tax benefits (such as the child tax credit) based on that depend- ent. If the name or SSN on the dependent's social security card is not correct or you need to get an SSN for your dependent, contact the Social Security Administration. See Social Security Number (SSN), earlier. If your dependent will not have a num- ber by the date your return is due, see What if You Cannot File on Time? earlier.

If your dependent child was born and died in 2012 and you do not have an SSN for the child, enter “Died” in column (2) and include a copy of the child's birth certificate, death certifi- cate, or hospital records. The document must show the child was born alive. Student. A student is a child who during any part of 5 calendar months of 2012 was enrolled as a full-time student at a school, or took a full-time, on-farm training course given by a school or a state, county, or local government agency. A school includes a technical, trade, or mechanical school. It does not include an on-the-job training course, correspondence school, or school of- fering courses only through the Internet.

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2012 Form 1040—Line 7

Income Generally, you must report all income except income that is exempt from tax by law. For details, see the following in- structions, especially the instructions for lines 7 through 21. Also see Pub. 525.

Foreign-Source Income 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 for- eign earned income. For details, see Pub. 54 and Form 2555 or 2555-EZ. Foreign retirement plans. If you were a beneficiary of a foreign retirement plan, you may have to report the undis- tributed 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 in- come.

Report distributions from foreign pension plans on lines 16a and 16b.

Foreign accounts and trusts. You must complete Part III of Schedule B if you:

Had a foreign account, or Received a distribution from, or

were a grantor of, or a transferor to, a foreign trust.

If you had foreign financial assets in 2012, you may have to file Form 8938. See Form 8938 and its instructions.

Chapter 11 Bankruptcy Cases If you are a debtor in a chapter 11 bank- ruptcy case, income taxable to the bank- ruptcy estate and reported on the estate's income tax return includes:

Earnings from services you per- formed after the beginning of the case (both wages and self-employment in- come), and

Income from property described in section 541 of title 11 of the U.S. Code that you either owned when the case be- gan 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 be- fore and after the beginning of the case. Also, you (or the trustee, if one is ap- pointed) must allocate between you and the bankruptcy estate the wages, salary, or other compensation and withheld in- come tax reported to you on Form W-2. A similar allocation is required for in- come and withheld income tax reported to you on Forms 1099. You must also include a statement that indicates you filed a chapter 11 case and that explains how income and withheld income tax re- ported 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 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 Form 8958 and Pub. 555. Nevada, Washington, and California domestic partners. A registered do- mestic partner in Nevada, Washington, or California (or a person in California who is married to a person of the same sex) generally must report half the com- bined community income of the individ- ual and his or her domestic partner (or California same-sex spouse). See Form 8958 and Pub. 555.

Rounding Off to Whole Dollars 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 un-

der 50 cents and increase amounts from 50 to 99 cents to the next dollar. For ex- ample, $1.39 becomes $1 and $2.50 be- comes $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.

Line 7 Wages, Salaries, Tips, etc. 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.

All wages received as a household employee for which you did not receive a Form W-2 because an employer paid you less than $1,800 in 2012. Also, enter “HSH” and the total amount not repor- ted on Form(s) W-2 on the dotted line next to line 7.

Tip income you did not report to your employer. This should include any allocated tips shown in box 8 on your Form(s) W-2 unless you can prove that your unreported tips are less than the amount in box 8. Allocated tips are not included as income in box 1. See Pub. 531 for more details. Also include the value of any noncash tips you received, such as tickets, passes, or other items of value. Although you do not report these noncash tips to your employer, you must report them on line 7.

You may owe social security and Medicare or railroad re- tirement (RRTA) tax on unre-

ported tips. See the instructions for line 57.

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 bene- fits, 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 ex- clude amounts if you adopted a child

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2012 Form 1040—Lines 7 Through 9a

with special needs and the adoption be- came final in 2012.

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 on- ly the amounts you used for expenses other than tuition and course-related ex- penses. 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 “Re- tirement plan” box in box 13 should be checked. If the total amount you (or your spouse if filing jointly) deferred for 2012 under all plans was more than $17,000 (excluding catch-up contribu- tions as explained below), include the excess on line 7. This limit is (a) $11,500 if you only have SIMPLE plans, or (b) $20,000 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 partici- pants in section 457(b) deferred com- pensation plans for the 3 years before re- tirement age. Contact your plan adminis- trator for more information.

If you were age 50 or older at the end of 2012, your employer may have al- lowed an additional deferral (catch-up contributions) of up to $5,500 ($2,500 for section 401(k)(11) and SIMPLE plans). This additional deferral amount is not subject to the overall limit on elec- tive 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 min- imum retirement age set by your em- ployer. But see Insurance Premiums for Retired Public Safety Officers in the in- structions for lines 16a and 16b. Disabil- ity pensions received after you reach minimum retirement age and other pay- ments shown on Form 1099-R (other

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than payments from an IRA*) are repor- ted on lines 16a and 16b. Payments from an IRA are reported on lines 15a and 15b.

Corrective distributions from a re- tirement plan shown on Form 1099-R of excess salary deferrals and excess con- tributions (plus earnings). But do not in- clude 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.

Were You a Statutory Employee? If you were, the “Statutory employee” box in box 13 of your Form W-2 should be checked. Statutory employees include full-time life insurance salespeople and certain agent or commission drivers, traveling salespeople, and 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.

Missing or Incorrect Form W-2? Your employer is required to provide or send Form W-2 to you no later than January 31, 2013. If you do not receive it by early February, use TeleTax topic 154 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.

Line 8a Taxable Interest 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 apply to you.

Interest credited in 2012 on deposits that you could not withdraw because of the bankruptcy or insolvency of the fi- nancial institution may not have to be included in your 2012 income. For de- tails, see Pub. 550.

If you get a 2012 Form 1099-INT for U.S. savings bond interest that includes

amounts you reported before 2012, see Pub. 550.

Line 8b Tax-Exempt Interest If you received any tax-exempt interest, such as from municipal bonds, each pay- er should send you a Form 1099-INT. Your tax-exempt interest should be shown in box 8 of Form 1099-INT. En- ter the total on line 8b. Also include on line 8b any exempt-interest dividends from a mutual fund or other regulated investment company. This amount should be shown in box 10 of Form 1099-DIV.

Do not include interest earned on your IRA, health savings account, Arch- er or Medicare Advantage MSA, or Coverdell education savings account.

Line 9a Ordinary Dividends Each payer should send you a Form 1099-DIV. Enter your total ordinary div- idends on line 9a. This amount should be shown in box 1a of Form(s) 1099-DIV.

You must fill in and attach Sched- ule B if the total is over $1,500 or you received, as a nominee, ordinary divi- dends that actually belong to someone else.

Nondividend Distributions 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 dis- tributions as capital gains on Form 8949. For details, see Pub. 550.

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2012 Form 1040—Lines 9a Through 10

Dividends on insurance poli- cies are a partial return of the premiums you paid. Do not re-

port 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.

Line 9b Qualified Dividends Enter your total qualified dividends on line 9b. Qualified dividends are also in- cluded in the ordinary dividend total re- quired to be shown on line 9a. Qualified dividends are eligible for a lower tax rate than other ordinary income. Gener- ally, these dividends are shown in box 1b of Form(s) 1099-DIV. See Pub. 550 for the definition of qualified divi- dends if you received dividends not re- ported on Form 1099-DIV. Exception. Some dividends may be re- ported as qualified dividends in box 1b of Form 1099-DIV but are not qualified dividends. These include:

Dividends you received as a nomi- nee. See the Schedule B instructions.

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 divi- dend on which the purchaser of a stock is not entitled to receive the next divi- dend payment. When counting the num- ber of days you held the stock, include the day you disposed of the stock but not the day you acquired it. See the exam- ples that follow. 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 re- ceived on any share of preferred stock held for less than 91 days during the 181-day period that began 90 days be- fore the ex-dividend date. When count- ing the number of days you held the stock, you cannot count certain days during which your risk of loss was di- minished. See Pub. 550 for more details. Preferred dividends attributable to peri- ods totaling less than 367 days are sub-

TIP ject to the 61-day holding period rule just described.

Dividends on any share of stock to the extent that you are under an obliga- tion (including a short sale) to make re- lated payments with respect to positions in substantially similar or related proper- ty.

Payments in lieu of dividends, but only if you know or have reason to know that the payments are not qualified dividends.

Example 1. You bought 5,000 shares of XYZ Corp. common stock on July 8, 2012. XYZ Corp. paid a cash dividend of 10 cents per share. The ex-dividend date was July 16, 2012. 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 11, 2012. You held your shares of XYZ Corp. for only 34 days of the 121-day period (from July 9, 2012, through Au- gust 11, 2012). The 121-day period be- gan on May 17, 2012 (60 days before the ex-dividend date), and ended on September 14, 2012. You have no quali- fied dividends from XYZ Corp. because you held the XYZ stock for less than 61 days.

Example 2. Assume the same facts as in Example 1 except that you bought the stock on July 15, 2012 (the day be- fore the ex-dividend date), and you sold the stock on September 16, 2012. You held the stock for 63 days (from July 16, 2012, through September 16, 2012). The $500 of qualified dividends shown in box 1b of Form 1099-DIV are all quali- fied dividends because you held the stock for 61 days of the 121-day period (from July 16, 2012, through September 14, 2012).

Example 3. You bought 10,000 shares of ABC Mutual Fund common stock on July 8, 2012. ABC Mutual Fund paid a cash dividend of 10 cents a share. The ex-dividend date was July 16, 2012. The ABC Mutual Fund advises you that the portion of the dividend eli- gible 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. How- ever, you sold the 10,000 shares on Au- gust 11, 2012. You have no qualified

dividends from ABC Mutual Fund be- cause you held the ABC Mutual Fund stock for less than 61 days.

Use the Qualified Dividends and Capital Gain Tax Work- sheet or the Schedule D Tax

Worksheet, whichever applies, to figure your tax. See the instructions for line 44 for details.

Line 10 Taxable Refunds, Credits, or Offsets of State and Local Income Taxes

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 2012, you may be required to report this amount. If you did not receive a Form 1099-G, check with the government agency that made the payments to you. Your 2012 Form 1099-G may have been made available to you only in an elec- tronic format, and you will need to get instructions from the agency to retrieve this document. Report any taxable re- fund you received even if you did not re- ceive Form 1099-G.

If you chose to apply part or all of the refund to your 2012 estimated state or local income tax, the amount applied is treated as received in 2012. If the refund was for a tax you paid in 2011 and you deducted state and local income taxes on line 5 of your 2011 Schedule A, use the State and Local Income Tax Refund Worksheet in these instructions to see if any of your refund is taxable. Exception. See Itemized Deduction Re- coveries in Pub. 525 instead of using the State and Local Income Tax Refund Worksheet in these instructions if any of the following applies.

1. You received a refund in 2012 that is for a tax year other than 2011.

2. You received a refund other than an income tax refund, such as a general sales tax or real property tax refund, in

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2012 Form 1040—Lines 10 Through 12

2012 of an amount deducted or credit claimed in an earlier year.

3. The amount on your 2011 Form 1040, line 42, was more than the amount on your 2011 Form 1040, line 41.

4. You had taxable income on your 2011 Form 1040, line 43, but no tax on your Form 1040, line 44, because of the 0% tax rate on net capital gain and qualified dividends in certain situations.

5. Your 2011 state and local income tax refund is more than your 2011 state and local income tax deduction minus the amount you could have deducted as your 2011 state and local general sales taxes.

6. You made your last payment of 2011 estimated state or local income tax in 2012.

7. You owed alternative minimum tax in 2011.

8. You could not use the full amount of credits you were entitled to in 2011 because the total credits were more than the amount shown on your 2011 Form 1040, line 46.

9. You could be claimed as a de- pendent by someone else in 2011.

10. You received a refund because of a jointly filed state or local income tax return, but you are not filing a joint 2012 Form 1040 with the same person.

Line 11 Alimony Received 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 penalty. For more details, see Pub. 504.

Line 12 Business Income or (Loss) If you operated a business or practiced your profession as a sole proprietor, re- port your income and expenses on Schedule C or C-EZ.

Line 13 Capital Gain or (Loss) If you sold a capital asset, such as a stock or bond, you must complete and attach Form 8949 and Schedule D. Exception 1. You do not have to file Form 8949 or Schedule D if both of the following apply.

1. You have no capital losses, and your only capital gains are capital gain

State and Local Income Tax Refund Worksheet—Line 10 Keep for Your Records Be sure you have read the Exception in the instructions for this line to see if you can use this worksheet instead of Pub. 525 to figure if any of your refund is taxable.

Before you begin:

1. Enter the income tax refund from Form(s) 1099­G (or similar statement). But do not enter more than the amount of your state and local income taxes shown on your 2011 Schedule A, line 5 . . . . . . . . . . . . 1.

2. Enter your total itemized deductions from your 2011 Schedule A, line 29 . . . . . . . . . . . 2.

Note. If the filing status on your 2011 Form 1040 was married filing separately and your spouse itemized deductions in 2011, skip lines 3 through 5, enter the amount from line 2 on line 6, and go to line 7.

3. Enter the amount shown below for the filing status claimed on your 2011 Form 1040.

Single or married filing separately—$5,800 Married filing jointly or qualifying widow(er)—$11,600 Head of household—$8,500 3.

4. Did you fill in line 39a on your 2011 Form 1040?

No. Enter -0-.

4. Yes.

Multiply the number in the box on line 39a of your 2011 Form 1040 by $1,150 ($1,450 if your 2011 filing status was single or head of household).

5. Add lines 3 and 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.

6. Is the amount on line 5 less than the amount on line 2?

No. STOP 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.

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2012 Form 1040—Lines 13 Through 15b

distributions from Form(s) 1099-DIV, box 2a (or substitute statements).

2. 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).

Exception 2. You must file Sched- ule D, but generally do not have to file Form 8949, if Exception 1 does not ap- ply and your only capital gains and los- ses are:

Capital gain distributions, A capital loss carryover from 2011, A gain from Form 2439 or 6252 or

Part I of Form 4797, A gain or loss from Form 4684,

6781, or 8824, or A gain or loss from a partnership, S

corporation, estate, or trust. If Exception 1 applies, enter your to-

tal capital gain distributions (from box 2a of Form(s) 1099-DIV) on line 13 and check the box on that line. If you re- ceived capital gain distributions as a nominee (that is, they were paid to you but actually belong to someone else), re- port on line 13 only the amount that be- longs to you. Include a statement show- ing the full amount you received and the amount you received as a nominee. See the Schedule B instructions for filing re- quirements for Forms 1099-DIV and 1096.

If you do not have to file Schedule D, use the Qualified Dividends and Capital Gain

Tax Worksheet in the line 44 instruc- tions to figure your tax.

Line 14 Other Gains or (Losses) If you sold or exchanged assets used in a trade or business, see the Instructions for Form 4797.

Lines 15a and 15b IRA Distributions You should receive a Form 1099-R showing the total amount of any distri- bution from your IRA before income tax or other deductions were withheld. This amount should be shown in box 1 of Form 1099-R. Unless otherwise noted in

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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 distri- bution (from Form 1099-R, box 1) on line 15b.

If you converted part or all of an IRA to a Roth IRA in 2010 and did not elect to report the taxable amount on your 2010 return, you generally should have reported half of it on your 2011 return. Report the rest on your 2012 return. See 2010 Roth IRA conversions, later. Exception 1. 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),

SEP or SIMPLE IRA to a tradition- al IRA, or

IRA to a qualified plan other than an IRA.

Also, enter “Rollover” next to line 15b. If the total distribution was rolled over in a qualified rollover, en- ter -0- on line 15b. If the total distribu- tion was not rolled over in a qualified rollover, enter the part not rolled over on line 15b unless Exception 2 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 roll- overs, see Pub. 590.

If you rolled over the distribution into a qualified plan other than an IRA or you made the rollover in 2013, include a statement explaining what you did. Exception 2. If any of the following ap- ply, enter the total distribution on line 15a and see Form 8606 and its in- structions to figure the amount to enter on line 15b.

1. 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 2012 or an earlier year. If you made nonde- ductible contributions to these IRAs for 2012, also see Pub. 590.

2. You received a distribution from a Roth IRA. But if either (a) or (b) be- low applies, enter -0- on line 15b; you

do not have to see Form 8606 or its in- structions.

a. 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 2007 or an earlier year.

b. Distribution code Q is shown in box 7 of Form 1099-R.

3. You converted part or all of a tra- ditional, SEP, or SIMPLE IRA to a Roth IRA in 2012.

4. You had a 2011 or 2012 IRA con- tribution returned to you, with the rela- ted earnings or less any loss, by the due date (including extensions) of your tax return for that year.

5. You made excess contributions to your IRA for an earlier year and had them returned to you in 2012.

6. You recharacterized part or all of a contribution to a Roth IRA as a tradi- tional IRA contribution, or vice versa.

Exception 3. 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 Excep- tion 2 applies to that part. Enter “QCD” next to line 15b.

A QCD is a distribution made direct- ly by the trustee of your IRA (other than an ongoing SEP or SIMPLE IRA) to an organization eligible to receive tax-de- ductible contributions (with certain ex- ceptions). You must have been at least age 701 2 when the distribution was made. Your total QCDs for the year can- not 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 contri- butions, the distribution is first consid- ered 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 in-

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2012 Form 1040—Lines 15b Through 16b

If a QCD is made in January 2013, you can elect to treat it as made in 2012. Also, a distri-

bution made to you in December 2012 can be treated as a QCD if you transfer- red it to a charity in January 2013. See Pub. 590.

Exception 4. If the distribution is a health savings account (HSA) funding distribution (HFD), enter the total distri- bution 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 Excep- tion 2 applies to that part. Enter “HFD” next to line 15b.

An HFD is a distribution made di- rectly by the trustee of your IRA (other than an ongoing 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 can- not exclude more than the limit on HSA contributions or more than the amount that would otherwise be included in your income. If your IRA includes nondeduc- tible contributions, the HFD is first con- sidered to be paid out of otherwise taxa- ble income. See Pub. 969 for details.

The amount of an HFD re- duces the amount you can con- tribute 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.

More than one exception applies. If more than one exception applies, include a statement showing the amount of each exception, instead of making an entry next to line 15b. For example: “Line 15b – $1,000 Rollover and $500 HFD.” But you do not need to attach a statement if only Exception 2 and one other excep- tion apply. 2010 Roth IRA conversions. If you converted part or all of an IRA to a Roth IRA in 2010 and did not elect to report the taxable amount on your 2010 return, include on line 15b the amount from your 2010 Form 8606, line 20b. Howev- er, you may have to include a different

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amount on line 15b if either of the fol- lowing applies.

You received a distribution from a Roth IRA in 2010 but not in 2011. See Pub. 590 to figure the amount to include on line 15b.

You received a distribution from a Roth IRA in 2011. Include on line 15b the amount from your 2011 Form 8606, line 38. More than one distribution. 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 addi- tional 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, 1941, and received less than the minimum re- quired distribution from your tradition- al, SEP, and SIMPLE IRAs. See the in- structions for line 58 for details.

More information. For more informa- tion about IRAs, see Pub. 590.

Lines 16a and 16b Pensions and Annuities You should receive a Form 1099-R showing the total amount of your pen- sion and annuity payments before in- come tax or other deductions were with- held. This amount should be shown in box 1 of Form 1099-R. Pension and an- nuity payments include distributions from 401(k), 403(b), and governmental 457(b) plans. Rollovers and lump-sum distributions are explained later. 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.

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Attach Form(s) 1099-R to Form 1040 if any federal income tax was withheld.

If you rolled over part or all of a qualified retirement plan (other than a designated Roth account) to a Roth IRA in 2010 (or you rolled over part or all of a 401(k) or 403(b) plan to a designated Roth account in 2010) and did not elect to report the taxable amount on your 2010 return, you generally should have reported half of it on your 2011 return. Report the rest on your 2012 return. See 2010 Roth IRA rollovers, or 2010 in-plan Roth rollovers, whichever ap- plies, later.

Fully Taxable Pensions and Annuities Your payments are fully taxable if (a) you did not contribute to the cost (see Cost, later) of your pension or annuity, or (b) you got your entire cost back tax free before 2012. But see Insurance Pre- miums for Retired Public Safety Offi- cers, later. If your pension or annuity is fully taxable, enter the total pension or annuity payments (from Form(s) 1099-R, box 1) on line 16b; do not make an entry on line 16a.

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 Pub. 575 to find out how to report your benefits.

Partially Taxable Pensions and Annuities Enter the total pension or annuity pay- ments (from Form 1099-R, box 1) 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 later) was after July 1, 1986, see Simplified Method, later, to find out if you must use that method to figure the taxable part.

You can ask the IRS to figure the tax- able part for you for a $1,000 fee. For details, see Pub. 939.

If your Form 1099-R shows a taxable amount, you can report that amount on

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2012 Form 1040—Lines 16a and 16b

line 16b. But you may be able to report a lower taxable amount by using the Gen- eral Rule or the Simplified Method or if the exclusion for retired public safety of- ficers, discussed next, applies.

Insurance Premiums for Retired Public Safety Officers If you are an eligible retired public safe- ty officer (law enforcement officer, fire- fighter, 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 coverage by an accident or health plan or a long-term care insurance contract. You can do this only if you retired be- cause of disability or because you reached normal retirement age. The pre- miums can be for coverage for you, your spouse, or dependents. The distribution must be from a plan maintained by the employer from which you retired as a public safety officer. Also, the distribu- tion must be made directly from the plan to the provider of the accident or health plan or long-term care insurance con- tract. You can exclude from income the smaller of the amount of the premiums or $3,000. You can only make this elec- tion for amounts that would otherwise be included in your income.

An eligible retirement plan is a gov- ernmental plan that is a qualified trust or a section 403(a), 403(b), or 457(b) plan.

If you make this election, reduce the otherwise taxable amount of your pen- sion 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 re- porting your disability pension on line 7, include only the taxable amount on that line and enter “PSO” and the amount ex- cluded on the dotted line next to line 7.

Simplified Method You must use the Simplified Method if either of the following applies.

1. Your annuity starting date was af- ter July 1, 1986, and you used this meth- od last year to figure the taxable part.

2. Your annuity starting date was af- ter November 18, 1996, and both of the following apply.

a. The payments are from a quali- fied employee plan, a qualified employ- ee annuity, or a tax-sheltered annuity.

b. On your annuity starting date, ei- ther you were under age 75 or the num- ber of years of guaranteed payments was fewer than five. See Pub. 575 for the definition of guaranteed payments.

If you must use the Simplified Meth- od, complete the Simplified Method Worksheet in these instructions to figure the taxable part of your pension or annu- ity. 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 Serv- ice retirement benefits and you chose the alternative annuity

option, see Pub. 721 to figure the taxa- ble part of your annuity. Do not use the Simplified Method Worksheet in these instructions.

Annuity Starting Date 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.

Age (or Combined Ages) at Annuity Starting Date 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 com- bined ages on the annuity starting date.

If you are the beneficiary of an em- ployee who died, see Pub. 575. If there is more than one beneficiary, see Pub. 575 or Pub. 721 to figure each benefi- ciary's taxable amount.

Cost Your cost is generally your net invest- ment in the plan as of the annuity start- ing date. It does not include pre-tax con- tributions. Your net investment should be shown in box 9b of Form 1099-R for

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the first year you received payments from the plan.

Rollovers Generally, a qualified rollover is a tax-free distribution of cash or other as- sets from one retirement plan that is contributed to another plan within 60 days of receiving the distribution. How- ever, a qualified rollover to a Roth IRA or a designated Roth account is general- ly not a tax-free distribution. Use lines 16a and 16b to report a qualified roll- over, including a direct rollover, from one qualified employer's plan to another or to an IRA or SEP.

Enter on line 16a the distribution from Form 1099-R, box 1. From this amount, subtract any contributions (usu- ally shown in box 5) that were taxable to you when made. From that result, sub- tract the amount of the qualified roll- over. Enter the remaining amount on line 16b. If the remaining amount is zero and you have no other distribution to re- port on line 16b, enter zero on line 16b. Also, enter "Rollover" next to line 16b.

See Pub. 575 for more details on roll- overs, including special rules that apply to rollovers from designated Roth ac- counts, partial rollovers of property, and distributions under qualified domestic relations orders.

2010 Roth IRA rollovers. If you rolled over part or all of a qualified retirement plan (other than a designated Roth ac- count) to a Roth IRA in 2010 and did not elect to report the taxable amount on your 2010 return, include on line 16b the amount from your 2010 Form 8606, line 25b. However, you may have to in- clude a different amount on line 16b if either of the following applies.

You received a distribution from a Roth IRA in 2010 but not in 2011. See Pub. 575 to figure the amount to include on line 16b.

You received a distribution from a Roth IRA in 2011. Include on line 16b the amount from your 2011 Form 8606, line 38. 2010 in­plan Roth rollovers. If you rolled over part or all of a qualified re- tirement plan to a designated Roth ac- count in 2010 and did not elect to report the taxable amount on your 2010 return, include on line 16b the amount from

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2012 Form 1040—Lines 16a and 16b

Simplified Method Worksheet—Lines 16a and 16b Keep for Your Records

Before you begin: 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.

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 2012 on Form 1040, line 16a.

1.

Enter the total pension or annuity payments from Form 1099-R, box 1. Also, enter this amount on Form 1040, line 16a . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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 before entering an amount on line 16b . . . . . . . . . . . . . . . . . . . . . . . 9.

10. Was your annuity starting date before 1987?

Yes. STOP Leave line 10 blank.

No. Add lines 6 and 8. This is the amount you have recovered tax free through 2012. 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 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 were . . . THEN enter on line 3 . . .

110 or under 410 111–120 360 121–130 310 131–140 260 141 or older 210

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2012 Form 1040—Lines 16b Through 21

your 2010 Form 8606, line 25b. Howev- er, you may have to include a different amount on line 16b if either of the fol- lowing applies.

You received a distribution from your designated Roth account allocable to an in-plan Roth rollover in 2010 but not in 2011. See Pub. 575 to figure the amount to include on line 16b.

You received a distribution from your designated Roth account allocable to an in-plan Roth rollover in 2011. In- clude on line 16b the amount from your 2011 Form 8606, line 48.

Lump-Sum Distributions If you received a lump-sum distribution from a profit-sharing or retirement plan, your Form 1099-R should have the "To- tal 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 quali- fied rollover. For details, see the instruc- tions for line 58.

Enter the total distribution on line 16a and the taxable part on line 16b. For details, see Pub 575.

If you or the plan participant was born before January 2, 1936, you could pay less tax on

the distribution. See Form 4972.

Line 19 Unemployment Compensation You should receive a Form 1099-G showing in box 1 the total unemploy- ment compensation paid to you in 2012. Report this amount on line 19. However, if you made contributions to a govern- mental unemployment compensation program or to a governmental paid fami- ly leave program and you are not itemiz- ing deductions, reduce the amount you report on line 19 by those contributions.

If you received an overpayment of unemployment compensation in 2012 and you repaid any of it in 2012, sub- tract the amount you repaid from the to- tal amount you received. Enter the result on line 19. Also, enter “Repaid” and the amount you repaid on the dotted line next to line 19. If, in 2012, you repaid

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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 re- paid more than $3,000, see Repayments in Pub. 525 for details on how to report the repayment.

Lines 20a and 20b Social Security Benefits You should receive a Form SSA-1099 showing in box 3 the total social securi- ty benefits paid to you. Box 4 will show the amount of any benefits you repaid in 2012. If you received railroad retirement benefits treated as social security, you should receive a Form RRB-1099.

Use the Social Security Benefits Worksheet in these instructions to see if any of your benefits are taxable. Exception. Do not use the Social Se- curity Benefits Worksheet in these in- structions if any of the following ap- plies.

You made contributions to a tradi- tional IRA for 2012 and you or your spouse were covered by a retirement plan at work or through self-employ- ment. Instead, use the worksheets in Pub. 590 to see if any of your social se- curity benefits are taxable and to figure your IRA deduction.

You repaid any benefits in 2012 and your total repayments (box 4) were more than your total benefits for 2012 (box 3). None of your benefits are taxa- ble for 2012. 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 de- tails, see Pub. 915.

You file Form 2555, 2555-EZ, 4563, or 8815, or you exclude employ- er-provided adoption benefits or income from sources within Puerto Rico. In- stead, use the worksheet in Pub. 915.

Line 21 Other Income

Do not report on this line any income from self-employment or fees received as a notary

public. Instead, you must use Sched- ule C, C-EZ, or F, even if you do not

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have any business expenses. Also, do not report on line 21 any nonemployee com- pensation shown on Form 1099-MISC (unless it is not self-employment income, such as income from a hobby or a sporadic activity). Instead, see the in- structions on Form 1099-MISC to find out where to report that income.

Taxable income. Use line 21 to report any taxable income not reported else- where on your return or other schedules. List the type and amount of income. If necessary, include a statement showing the required information. For more de- tails, see Miscellaneous Income in Pub. 525.

Examples of income to report on line 21 include the following.

Most prizes and awards. Jury duty pay. Also, see the in-

structions for line 36. Alaska Permanent Fund dividends. Taxable distributions from a Cov-

erdell 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 2012, and (b) they were not included in a qualified rollover. See Pub. 970. Nontaxable dis- tributions from these accounts, including rollovers, do not have to be reported on Form 1040.

You may have to pay an addi- tional tax if you received a tax- able distribution from a Cover-

dell 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 ex- penses of the account beneficiary or ac- count holder in 2012, and (b) they were not included in a qualified rollover. See Pub. 969.

You may have to pay an addi- tional tax if you received a tax- able distribution from an HSA

or an Archer MSA. See the Instructions for Form 8889 for HSAs or the Instruc- tions for Form 8853 for Archer MSAs.

Amounts deemed to be income from an HSA because you did not re-

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2012 Form 1040—Lines 20a and 20b

Social Security Benefits Worksheet—Lines 20a and 20b Keep for Your Records 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). If you are married filing separately and you lived apart from your spouse for all of 2012, 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 in the line 20a and 20b instructions to see if you can use this worksheet instead of a publication to find out if any of your benefits are taxable.

Before you begin:

1. Enter the total amount from box 5 of all your Forms SSA­1099 and Forms RRB­1099. Also, enter this amount on Form 1040, line 20a . . . . 1.

2. Enter one-half of line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2. 3. Combine 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. Combine 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. STOP

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 2012, enter $25,000 . . . . . . . . . . . . . . . 8.

Married filing separately and you lived with your spouse at any time in 2012, 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.

STOP 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 2012, 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 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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.

TIP If any of your benefits are taxable for 2012 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.

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2012 Form 1040—Lines 21 Through 24

main an eligible individual during the testing period. See Form 8889, Part III.

Gambling winnings, including lot- teries, raffles, a lump-sum payment from the sale of a right to receive future lot- tery payments, etc. For details on gam- bling losses, see the instructions for Schedule A, line 28.

Attach Form(s) W-2G to Form 1040 if any federal in- come tax was withheld.

Alternative trade adjustment assis- tance (ATAA) or reemployment trade adjustment assistance (RTAA) pay- ments. 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 es- tate taxes, general sales taxes, or home mortgage interest. See Recoveries 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 in- structions for line 36.

Income from an activity not engag- ed in for profit. See Pub. 535.

Loss on certain corrective distribu- tions of excess deferrals. See Retirement Plan Contributions 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 contribu- tion deduction relating to the contribu- tion of a fractional interest in tangible personal property. See Fractional Inter- est in Tangible Personal Property in Pub. 526. Interest and an additional 10% tax apply to the amount of the recapture. See the instructions for line 60.

Recapture of a charitable contribu- tion deduction if the charitable organiza- tion disposes of the donated property within 3 years of the contribution. See Recapture if no exempt use 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 IRS.gov and enter “canceled debt” or “foreclosure” in the search box.

Taxable part of disaster relief pay- ments. See Pub. 525 to figure the taxa-

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ble part, if any. If any of your disaster relief payment is taxable, attach a state- ment showing the total payment re- ceived and how you figured the taxable part. Nontaxable income. Do not report any nontaxable income on line 21. Examples of nontaxable income include the fol- lowing.

Child support. Payments you received to help you

pay your mortgage loan under the HFA Hardest Hit Fund or the Emergency Homeowners' Loan Program or similar state program.

Any Pay-for-Performance Success Payments that reduce the principal bal- ance of your home mortgage under the Home Affordable Modification Pro- gram.

Life insurance proceeds received because of someone's death (other than from certain employer-owned life insur- ance contracts).

Gifts and bequests. However, if you received a gift or bequest from a foreign person of more than $14,723, you may have to report information about it on Form 3520, Part IV. See the Instructions for Form 3520. Net operating loss (NOL) deduction. Include on line 21 any NOL deduction from an earlier year. Subtract it from any income on line 21 and enter the re- sult. If the result is less than zero, enter it in parentheses. On the dotted line next to line 21, enter “NOL” and show the amount of the deduction in parentheses. See Pub. 536 for details.

Adjusted Gross Income Line 23 Educator Expenses If you were an eligible educator in 2012, you can deduct on line 23 up to $250 of qualified expenses you paid in 2012. If you and your spouse are filing jointly and both of you were eligible educators, the maximum deduction is $500. How- ever, neither spouse can deduct more than $250 of his or her qualified expen- ses on line 23. You may be able to de- duct expenses that are more than the

$250 (or $500) limit on Schedule A, line 21. An eligible educator is a kinder- garten through grade 12 teacher, instruc- tor, counselor, principal, or aide who worked in a school for at least 900 hours during a school year.

Qualified expenses include ordinary and necessary expenses paid in connec- tion with books, supplies, equipment (including computer equipment, soft- ware, and services), and other materials used in the classroom. An ordinary ex- pense is one that is common and accep- ted in your educational field. A necessa- ry expense is one that is helpful and ap- propriate for your profession as an edu- cator. An expense does not have to be required to be considered necessary.

Qualified expenses do not include ex- penses for home schooling or for non- athletic supplies for courses in health or physical education.

You must reduce your qualified ex- penses by the following amounts.

Excludable U.S. series EE and I savings bond interest from Form 8815.

Nontaxable qualified tuition pro- gram earnings or distributions.

Any nontaxable distribution of Coverdell education savings account earnings.

Any reimbursements you received for these expenses that were not reported to you in box 1 of your Form W-2.

For more details, use Teletax topic 458 or see Pub. 529.

Line 24 Certain Business Expenses of Reservists, Performing Artists, and Fee-Basis Government Officials Include the following deductions on line 24.

Certain business expenses of Na- tional Guard and reserve members who traveled more than 100 miles from home to perform services as a National Guard or reserve member.

Performing-arts-related expenses as a qualified performing artist.

Business expenses of fee-basis state or local government officials.

For more details, see Form 2106 or 2106-EZ.

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2012 Form 1040—Lines 25 Through 29

Line 25 Health Savings Account (HSA) Deduction You may be able to take this deduction if contributions (other than employer contributions, rollovers, and qualified HSA funding distributions from an IRA) were made to your HSA for 2012. See Form 8889.

Line 26 Moving Expenses If you moved in connection with your job or business or started a new job, you may be able to take this deduction. But your new workplace must be at least 50 miles farther from your old home than your old home was from your old work- place. If you had no former workplace, your new workplace must be at least 50 miles from your old home. Use TeleTax topic 455 or see Form 3903.

Line 27 Deductible Part of Self-Employment Tax If you were self-employed and owe self-employment tax, fill in Schedule SE to figure the amount of your deduction. If you completed Section A of Sched- ule SE, the deductible part of your self-employment tax is on line 6. If you completed Section B of Schedule SE, it is on line 13.

Line 28 Self-Employed SEP, SIMPLE, and Qualified Plans If you were self-employed or a partner, you may be able to take this deduction. See Pub. 560 or, if you were a minister, Pub. 517.

Line 29 Self-Employed Health Insurance Deduction You may be able to deduct the amount you paid for health insurance for your- self, your spouse, and your dependents. The insurance can also cover your child who was under age 27 at the end of 2012, even if the child was not your de- pendent. A child includes your son, daughter, stepchild, adopted child, or foster child (defined in the line 6c in- structions).

One of the following statements must be true.

You were self-employed and had a net profit for the year.

You were a partner with net earn- ings from self-employment.

You used one of the optional meth- ods to figure your net earnings from self-employment on Schedule SE.

You received wages in 2012 from an S corporation in which you were a more-than-2% shareholder. Health in-

Self-Employed Health Insurance Deduction Worksheet—Line 29 Keep for Your Records If, during 2012, you were an eligible trade adjustment assistance (TAA) recipient, alternative TAA (ATAA) recipient, reemployment TAA (RTAA) recipient, or Pension Benefit Guaranty Corporation pension recipient, see the instructions for Form 8885 to figure the amount to enter on line 1 of this worksheet. Be sure you have read the Exception in the instructions for this line to see if you can use this worksheet instead of Pub. 535 to figure your deduction.

Before you begin:

1. Enter the total amount paid in 2012 for health insurance coverage established under your business (or the S corporation in which you were a more-than-2% shareholder) for 2012 for you, your spouse, and your dependents. Your insurance can also cover your child who was under age 27 at the end of 2012, even if the child was not your dependent. But do not include amounts for any month you were eligible to participate in an employer-sponsored health plan or amounts paid from retirement plan distributions that were nontaxable because you are a retired public safety officer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. Enter your net profit* and any other earned income** from the business under which the insurance plan is established, minus any deductions on Form 1040, lines 27 and 28. Do not include Conservation Reserve Program payments exempt from self-employment tax . . . . . . . . . . . . . . . . . . . 2.

3. Self­employed health insurance deduction. Enter the smaller of line 1 or line 2 here and on Form 1040, line 29. Do not include this amount in figuring any medical expense deduction on Schedule A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.

*If you used either optional method to figure your net earnings from self-employment, do not enter your net profit. Instead, enter the amount from Schedule SE, Section B, line 4b.

**Earned income includes net earnings and gains from the sale, transfer, or licensing of property you created. However, it does not include capital gain income. If you were a more-than-2% shareholder in the S corporation under which the insurance plan is established, earned income is your Medicare wages (box 5 of Form W-2) from that corporation.

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2012 Form 1040—Lines 29 Through 32

surance premiums paid or reimbursed by the S corporation are shown as wages on Form W-2.

The insurance plan must be establish- ed under your business. Your personal services must have been a material in- come-producing factor in the business. If you are filing Schedule C, C-EZ, or F, the policy can be either in your name or in the name of the business.

If you are a partner, the policy can be either in your name or in the name of the partnership. You can either pay the pre- miums yourself or your partnership can pay them and report them as guaranteed payments. If the policy is in your name and you pay the premiums yourself, the partnership must reimburse you and re- port the premiums as guaranteed pay- ments.

If you are a more-than-2% sharehold- er in an S corporation, the policy can be either in your name or in the name of the S corporation. You can either pay the premiums yourself or the S corporation can pay them and report them as wages. If the policy is in your name and you pay the premiums yourself, the S corpo- ration must reimburse you. You can de- duct the premiums only if the S corpora- tion reports the premiums paid or reim- bursed as wages in box 1 of your Form W-2 in 2012 and you also report the pre- mium payments or reimbursements as wages on Form 1040, line 7.

But if you were also eligible to par- ticipate in any subsidized health plan maintained by your or your spouse's em- ployer for any month or part of a month in 2012, amounts paid for health insur- ance coverage for that month cannot be used to figure the deduction. Also, if you were eligible for any month or part of a month to participate in any subsi- dized health plan maintained by the em- ployer of either your dependent or your child who was under age 27 at the end of 2012, do not use amounts paid for coverage for that month to figure the de- duction.

Example. If you were eligible to par- ticipate in a subsidized health plan main- tained by your spouse's employer from September 30 through December 31, you cannot use amounts paid for health insurance coverage for September through December to figure your deduc- tion.

Medicare premiums you voluntarily pay to obtain insurance in your name that is similar to qualifying private health insurance can be used to figure the deduction. Amounts paid for health insurance coverage from retirement plan distributions that were nontaxable be- cause you are a retired public safety of- ficer cannot be used to figure the deduc- tion.

For more details, see Pub. 535. If you qualify to take the deduction,

use the Self-Employed Health Insurance Deduction Worksheet to figure the amount you can deduct. Exception. Use Pub. 535 instead of the Self-Employed Health Insurance Deduc- tion Worksheet in these instructions to figure your deduction if any of the fol- lowing applies.

You had more than one source of income subject to self-employment tax.

You file Form 2555 or 2555-EZ. You are using amounts paid for

qualified long-term care insurance to figure the deduction.

Line 30 Penalty on Early Withdrawal of Savings The Form 1099-INT or Form 1099-OID you received will show the amount of any penalty you were charged.

Lines 31a and 31b Alimony Paid If you made payments to or for your spouse or former spouse under a divorce or separation instrument, you may be able to take this deduction. Use TeleTax topic 452 or see Pub. 504.

Line 32 IRA Deduction

If you made any nondeductible contributions to a traditional individual retirement arrange-

ment (IRA) for 2012, you must report them on Form 8606.

If you made contributions to a tradition- al IRA for 2012, you may be able to take an IRA deduction. But you, or your spouse if filing a joint return, must have

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had earned income to do so. For IRA purposes, earned income includes alimo- ny and separate maintenance payments reported on line 11. If you were a mem- ber of the U.S. Armed Forces, earned in- come includes any nontaxable combat pay you received. If you were self-em- ployed, earned income is generally your net earnings from self-employment if your personal services were a material income-producing factor. For more de- tails, see Pub. 590. A statement should be sent to you by May 31, 2013, that shows all contributions to your tradition- al IRA for 2012.

Use the IRA Deduction Worksheet to figure the amount, if any, of your IRA deduction. But read the following 10-item list before you fill in the work- sheet.

1. If you were age 701 2 or older at the end of 2012, you cannot deduct any contributions made to your traditional IRA for 2012 or treat them as nondeduc- tible contributions.

2. You cannot deduct contributions to a Roth IRA. But you may be able to take the retirement savings contributions credit (saver's credit). See the instruc- tions for line 50.

If you are filing a joint return and you or your spouse made contributions to both a tradi-

tional IRA and a Roth IRA for 2012, do not use the IRA Deduction Worksheet in these instructions. Instead, see Pub. 590 to figure the amount, if any, of your IRA deduction.

3. You cannot deduct elective defer- rals to a 401(k) plan, 403(b) plan, sec- tion 457 plan, SIMPLE plan, or the fed- eral Thrift Savings Plan. These amounts are not included as income in box 1 of your Form W-2. But you may be able to take the retirement savings contributions credit. See the instructions for line 50.

4. If you made contributions to your IRA in 2012 that you deducted for 2011, do not include them in the worksheet.

5. If you received income from a nonqualified deferred compensation plan or nongovernmental section 457 plan that is included in box 1 of your Form W-2, or in box 7 of Form 1099-MISC, do not include that income on line 8 of the worksheet. The income should be shown in (a) box 11 of your

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2012 Form 1040—Line 32

Form W-2, (b) box 12 of your Form W-2 with code Z, or (c) box 15b of Form 1099-MISC. If it is not, contact your employer or the payer for the amount of the income.

6. You must file a joint return to de- duct contributions to your spouse's IRA. Enter the total IRA deduction for you and your spouse on line 32.

7. Do not include qualified rollover contributions in figuring your deduction. Instead, see the instructions for lines 15a and 15b.

8. Do not include trustees' fees that were billed separately and paid by you for your IRA. These fees can be deduc- ted only as an itemized deduction on Schedule A.

9. Do not include any repayments of qualified reservist distributions. You cannot deduct them. For information on how to report these repayments, see Qualified reservist repayments in Pub. 590.

10. If the total of your IRA deduction on line 32 plus any nondeductible con-

tribution to your traditional IRAs shown on Form 8606 is less than your total tra- ditional IRA contributions for 2012, see Pub. 590 for special rules.

By April 1 of the year after the year in which you turn age 701 2, you must start taking

minimum required distributions from your traditional IRA. If you do not, you may have to pay a 50% additional tax on the amount that should have been distributed. For details, including how to figure the minimum required distribu- tion, see Pub. 590.

Were You Covered by a Retirement Plan? If you were covered by a retirement plan (qualified pension, profit-sharing (in- cluding 401(k)), annuity, SEP, SIMPLE, etc.) at work or through self-employ- ment, your IRA deduction may be re- duced or eliminated. But you can still make contributions to an IRA even if you cannot deduct them. In any case, the

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income earned on your IRA contribu- tions is not taxed until it is paid to you.

The “Retirement plan” box in box 13 of your Form W-2 should be checked if you were covered by a plan at work even if you were not vested in the plan. You are also covered by a plan if you were self-employed and had a SEP, SIMPLE, or qualified retirement plan.

If you were covered by a retirement plan and you file Form 2555, 2555-EZ, or 8815, or you exclude employer-provi- ded adoption benefits, see Pub. 590 to figure the amount, if any, of your IRA deduction. Married persons filing separately. If you were not covered by a retirement plan but your spouse was, you are con- sidered covered by a plan unless you lived apart from your spouse for all of 2012.

You may be able to take the re- tirement savings contributions credit. See the line 50 instruc-

tions.

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2012 Form 1040—Line 32

IRA Deduction Worksheet—Line 32 Keep for Your Records If you were age 701 2 or older at the end of 2012, you cannot deduct any contributions made to your traditional IRA or treat them as nondeductible contributions. Do not complete this worksheet for anyone age 701 2 or older at the end of 2012. If you are married filing jointly and only one spouse was under age 701 2 at the end of 2012, complete this work-

sheet only for that spouse.

Be sure you have read the 10-item list in the instructions for this line. You may not be able to use this worksheet. Figure any write-in adjustments to be entered on the dotted line next to line 36 (see the instructions for line 36). If you are married filing separately and you lived apart from your spouse for all of 2012, enter “D” on the dotted line next to Form 1040, line 32. If you do not, you may get a math error notice from the IRS.

Before you begin:

Your IRA Spouse's IRA 1a. Were you covered by a retirement plan (see Were You Covered by a

Retirement Plan?)? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1a. Yes No b. If married filing jointly, was your spouse covered by a retirement plan? . . . . . . . . . . . . . . . . . . . . . . . . . 1b. Yes No

Next. If you checked “No” on line 1a (and “No” on line 1b if married filing jointly), skip lines 2 through 6, enter the applicable amount below on line 7a (and line 7b if applicable), and go to line 8.

$5,000, if under age 50 at the end of 2012. $6,000, if age 50 or older but under age 701 2 at the end of 2012.

Otherwise, go to line 2. 2. Enter the amount shown below that applies to you.

Single, head of household, or married filing separately and you lived apart from your spouse for all of 2012, enter $68,000

Qualifying widow(er), enter $112,000 2a. 2b. Married filing jointly, enter $112,000 in both columns. But if you checked

“No” on either line 1a or 1b, enter $183,000 for the person who was not covered by a plan

Married filing separately and you lived with your spouse at any time in 2012, enter $10,000

3. Enter the amount from Form 1040, line 22 . . . . . . . 3. 4. Enter the total of the amounts from Form 1040, lines

23 through 31a, plus any write-in adjustments you entered on the dotted line next to line 36 . . . . . . . . . 4.

5. Subtract line 4 from line 3. If married filing jointly, enter the result in both columns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5a. 5b.

6. Is the amount on line 5 less than the amount on line 2? No. STOP None of your IRA contributions are deductible. For details on nondeductible IRA contributions, see Form 8606.

Yes. Subtract line 5 from line 2 in each column. Follow the instruction below that applies to you. If single, head of household, or married filing separately,

and the result is $10,000 or more, enter the applicable amount below on line 7 for that column and go to line 8. i. $5,000, if under age 50 at the end of 2012. ii. $6,000, if age 50 or older but under age 701 2 at the end of 2012. If the result is less than $10,000, go to line 7. 6a. 6b.

If married filing jointly or qualifying widow(er), and the result is $20,000 or more ($10,000 or more in the column for the IRA of a person who was not covered by a retirement plan), enter the applicable amount below on line 7 for that column and go to line 8. i. $5,000, if under age 50 at the end of 2012. ii. $6,000 if age 50 or older but under age 701 2 at the end of 2012. Otherwise, go to line 7.

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2012 Form 1040—Line 32

IRA Deduction Worksheet—Continued Your IRA Spouse's IRA

7. Multiply lines 6a and 6b by the percentage below that applies to you. If the result is not a multiple of $10, increase it to the next multiple of $10 (for example, increase $490.30 to $500). If the result is $200 or more, enter the result. But if it is less than $200, enter $200.

Single, head of household, or married filing separately, multiply by 50% (.50) (or by 60% (.60) in the column for the IRA of a person who is age 50 or older at the end of 2012)

Married filing jointly or qualifying widow(er), multiply by 25% (.25) (or by 30% (.30) in the column for the IRA of a person who is age 50 or older at the end of 2012). But if you checked “No” on either line 1a or 1b, then in the column for the IRA of the person who was not covered by a retirement plan, multiply by 50% (.50) (or by 60% (.60) if age 50 or older at the end of 2012)

7a. 7b.

8. Enter the total of your (and your spouse's if filing jointly):

Wages, salaries, tips, etc. Generally, this is the amount reported in box 1 of Form W-2. Exceptions are explained earlier in these instructions for line 32 8.

Alimony and separate maintenance payments reported on Form 1040, line 11

Nontaxable combat pay. This amount should be reported in box 12 of Form W-2 with code Q

9. Enter the earned income you (and your spouse if filing jointly) received as a self-employed individual or a partner. Generally, this is your (and your spouse's if filing jointly) net earnings from self-employment if your personal services were a material income-producing factor, minus any deductions on Form 1040, lines 27 and 28. If zero or less, enter -0-. For more details, see Pub. 590 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.

10. Add lines 8 and 9 . . . . . . . . . . . . . . . . . . . . . . . . . 10.

CAUTION ! If married filing jointly and line 10 is less than $10,000 ($11,000 if one spouse is age 50 or older at the end of 2012; $12,000 if both

spouses are age 50 or older at the end of 2012), stop here and see Pub. 590 to figure your IRA deduction.

11. Enter traditional IRA contributions made, or that will be made by April 15, 2013, for 2012 to your IRA on line 11a and to your spouse's IRA on line 11b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11a. 11b.

12. On line 12a, enter the smallest of line 7a, 10, or 11a. On line 12b, enter the smallest of line 7b, 10, or 11b. This is the most you can deduct. Add the amounts on lines 12a and 12b and enter the total on Form 1040, line 32. Or, if you want, you can deduct a smaller amount and treat the rest as a nondeductible contribution (see Form 8606) . . . . . . . . . . . . . . . . . . . . . . . . . . 12a. 12b.

Line 33 Student Loan Interest Deduction You can take this deduction only if all of the following apply.

You paid interest in 2012 on a qualified student loan (defined later).

Your filing status is any status ex- cept married filing separately.

Your modified adjusted gross in- come (AGI) is less than: $75,000 if sin- gle, head of household, or qualifying

widow(er); $155,000 if married filing jointly. Use lines 2 through 4 of the worksheet below to figure your modi- fied AGI.

You, or your spouse if filing joint- ly, are not claimed as a dependent on someone else's (such as your parent's) 2012 tax return.

Use the worksheet in these instruc- tions to figure your student loan interest deduction. Exception. Use Pub. 970 instead of the worksheet in these instructions to figure your student loan interest deduction if

you file Form 2555, 2555-EZ, or 4563, or you exclude income from sources within Puerto Rico. Qualified student loan. A qualified student loan is any loan you took out to pay the qualified higher education ex- penses for any of the following individu- als who was an eligible student.

1. Yourself or your spouse. 2. Any person who was your de-

pendent when the loan was taken out.

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2012 Form 1040—Line 33

3. Any person you could have claimed as a dependent for the year the loan was taken out except that:

a. The person filed a joint return, b. The person had gross income that

was equal to or more than the exemption amount for that year ($3,800 for 2012), or

c. You, or your spouse if filing jointly, could be claimed as a dependent on someone else's return.

However, a loan is not a qualified student loan if (a) any of the proceeds were used for other purposes, or (b) the loan was from either a related person or a person who borrowed the proceeds un- der a qualified employer plan or a con- tract purchased under such a plan. For details, see Pub. 970. Qualified higher education expenses. Qualified higher education expenses generally include tuition, fees, room and

board, and related expenses such as books and supplies. The expenses must be for education in a degree, certificate, or similar program at an eligible educa- tional institution. An eligible education- al institution includes most colleges, universities, and certain vocational schools. For details, see Pub. 970.

Student Loan Interest Deduction Worksheet—Line 33 Keep for Your Records Figure any write-in adjustments to be entered on the dotted line next to line 36 (see the instructions for line 36). Be sure you have read the Exception above to see if you can use this worksheet instead of Pub. 970 to figure your deduction.

Before you begin:

1. Enter the total interest you paid in 2012 on qualified student loans (see above). Do not enter more than $2,500 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. Enter the amount from Form 1040, line 22 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.

3. 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 . . . . . . . . . . . . . 3.

4. Subtract line 3 from line 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.

5. Enter the amount shown below for your filing status. Single, head of household, or qualifying

widow(er)—$60,000 Married filing jointly—$125,000

. . . . . . . . . . . . . 5.

6. Is the amount on line 4 more than the amount on line 5?

No. Skip lines 6 and 7, enter -0- on line 8, and go to line 9.

Yes. Subtract line 5 from line 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.

7. Divide line 6 by $15,000 ($30,000 if married filing jointly). Enter the result as a decimal (rounded to at least three places). If the result is 1.000 or more, enter 1.000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. .

8. Multiply line 1 by line 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.

9. Student loan interest deduction. Subtract line 8 from line 1. Enter the result here and on Form 1040, line 33. Do not include this amount in figuring any other deduction on your return (such as on Schedule A, C, E, etc.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.

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2012 Form 1040—Lines 34 Through 40

Line 34 Tuition and Fees If you paid qualified tuition and fees for yourself, your spouse, or your depend- ent(s), you may be able to take this de- duction. See Form 8917.

You may be able to take a credit for your educational ex- penses instead of a deduction.

See the instructions for lines 49 and 66 for details.

Line 35 Domestic Production Activities Deduction You may be able to deduct up to 9% of your qualified production activities in- come from the following activities.

1. Construction of real property per- formed in the United States.

2. Engineering or architectural serv- ices performed in the United States for construction of real property in the Uni- ted States.

3. Any lease, rental, license, sale, exchange, or other disposition of:

a. Tangible personal property, com- puter software, and sound recordings that you manufactured, produced, grew, or extracted in whole or in significant part in the United States,

b. Any qualified film you produced, or

c. Electricity, natural gas, or potable water you produced in the United States.

In certain cases, the references above to the United States include Puerto Rico.

Your deduction may be reduced if you had oil-related qualified production activities income.

The deduction does not apply to in- come derived from:

The sale of food and beverages you prepared at a retail establishment;

Property you leased, licensed, or rented for use by any related person;

The transmission or distribution of electricity, natural gas, or potable water; or

The lease, rental, license, sale, ex- change, or other disposition of land.

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For details, see Form 8903 and its in- structions.

Line 36 Include in the total on line 36 any of the following write-in adjustments. To find out if you can take the deduction, see the form or publication indicated. On the dotted line next to line 36, enter the amount of your deduction and identify it as indicated.

Archer MSA deduction (see Form 8853). Identify as “MSA.”

Jury duty pay if you gave the pay to your employer because your employ- er paid your salary while you served on the jury. Identify as “Jury Pay.”

Deductible expenses related to in- come reported on line 21 from the rental of personal property engaged in for prof- it. Identify as “PPR.”

Reforestation amortization and ex- penses (see Pub. 535). Identify as “RFST.”

Repayment of supplemental unem- ployment benefits under the Trade Act of 1974 (see Pub. 525). Identify as “Sub-Pay TRA.”

Contributions to section 501(c)(18) (D) pension plans (see Pub. 525). Identi- fy as “501(c)(18)(D).”

Contributions by certain chaplains to section 403(b) plans (see Pub. 517). Identify as “403(b).”

Attorney fees and court costs for actions involving certain unlawful dis- crimination claims, but only to the ex- tent of gross income from such actions (see Pub. 525). Identify as “UDC.”

Attorney fees and court costs you paid in connection with an award from the IRS for information you provided that helped the IRS detect tax law viola- tions, up to the amount of the award in- cludible in your gross income. Identify as “WBF.”

Line 37 If line 37 is less than zero, you may have a net operating loss that you can carry to another tax year. See the Instructions for Form 1045 for details.

Tax and Credits Line 39a If you were born before January 2, 1948, or were blind at the end of 2012, check the appropriate box(es) on line 39a. If you were married and checked the box on Form 1040, line 6b, and your spouse was born before January 2, 1948, or was blind at the end of 2012, also check the appropriate box(es) for your spouse. Be sure to enter the total number of boxes checked. Do not check any box(es) for your spouse if your filing status is head of household.

Blindness If you were not totally blind as of De- cember 31, 2012, you must get a state- ment certified by your eye doctor (oph- thalmologist or optometrist) that:

You cannot see better than 20/200 in your better eye with glasses or contact lenses, or

Your field of vision is 20 degrees or less.

If your eye condition is not likely to improve beyond the conditions listed above, you can get a statement certified by your eye doctor (ophthalmologist or optometrist) to this effect instead.

You must keep the statement for your records.

Line 39b If your filing status is married filing sep- arately (box 3 is checked), and your spouse itemizes deductions on his or her return, check the box on line 39b. Also check that box if you were a dual-status alien. But if you were a dual-status alien and you file a joint return with your spouse who was a U.S. citizen or resi- dent alien at the end of 2012 and you and your spouse agree to be taxed on your combined worldwide income, do not check the box.

Line 40 Itemized Deductions or Standard Deduction In most cases, your federal income tax will be less if you take the larger of your

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2012 Form 1040—Lines 40 and 44

itemized deductions or standard deduc- tion.

Itemized Deductions To figure your itemized deductions, fill in Schedule A.

Standard Deduction Most people can find their standard de- duction by looking at the amounts listed under “All others” to the left of line 40. Exception 1 – dependent. If you, or your spouse if filing jointly, can be claimed as a dependent on someone else's 2012 return, use the Standard De- duction Worksheet for Dependents to figure your standard deduction. Exception 2 – box on line 39a checked. If you checked any box on line 39a, use the chart below the Standard Deduction Worksheet for Dependents to figure your standard deduction. Exception 3 – box on line 39b checked. If you checked the box on line 39b, your standard deduction is zero, even if you were born before Janu- ary 2, 1948, or were blind.

If you received a refund in 2012 of an amount (such as re- al estate taxes) that increased

your standard deduction in an earlier year, you generally have to include the refund in your income. See Recoveries in Pub. 525.

Line 44 Tax Include in the total on line 44 all of the following taxes that apply.

Tax on your taxable income. Fig- ure the tax using one of the methods de- scribed here.

Tax from Form 8814 (relating to the election to report child's interest or dividends). Check the appropriate box.

Tax from Form 4972 (relating to lump-sum distributions). Check the ap- propriate box.

Tax due to making a section 962 election (the election made by a domes-

CAUTION !

tic shareholder of a controlled foreign corporation to be taxed at corporate rates). See section 962 for details. Check the appropriate box and attach a state- ment showing how you figured the tax.

Recapture of an education credit. You may owe this tax if you claimed an education credit in an earlier year, and either tax-free educational assistance or a refund of qualified expenses was re- ceived in 2012 for the student. See Form 8863 for more details. Enter the amount and “ECR” in the space next to line 44.

Do you want the IRS to figure the tax on your taxable income for you?

Yes. See chapter 29 of Pub. 17 for details, including who is eligible and what to do. If you have paid too much, we will send you a refund. If you did not pay enough, we will send you a bill.

No. Use one of the following methods to figure your tax. Tax Table or Tax Computation Worksheet. If your taxable income is less than $100,000, you must use the Tax Table, later in these instructions, to figure your tax. Be sure you use the cor- rect column. If your taxable income is $100,000 or more, use the Tax Compu- tation Worksheet right after the Tax Ta- ble.

However, do not use the Tax Table or Tax Computation Worksheet to figure your tax if any of the following applies. Form 8615. Form 8615 generally must be used to figure the tax for any child who had more than $1,900 of invest- ment income, such as taxable interest, ordinary dividends, or capital gains (in- cluding capital gain distributions), and who either:

1. Was under age 18 at the end of 2012,

2. Was age 18 at the end of 2012 and did not have earned income that was more than half of the child's support, or

3. Was a full-time student over age 18 and under age 24 at the end of 2012 and did not have earned income that was more than half of the child's support.

But if the child files a joint return for 2012 or if neither of the child's parents was alive at the end of 2012, do not use Form 8615 to figure the child's tax.

A child born on January 1, 1995, is considered to be age 18 at the end of 2012; a child born on January 1, 1994, is considered to be age 19 at the end of 2012; a child born on January 1, 1989, is considered to be age 24 at the end of 2012. Schedule D Tax Worksheet. If you have to file Schedule D, and line 18 or 19 of Schedule D is more than zero, use the Schedule D Tax Worksheet in the Instructions for Schedule D to figure the amount to enter on Form 1040, line 44. But if you are filing Form 2555 or 2555-EZ, you must use the Foreign Earned Income Tax Worksheet instead.

Qualified Dividends and Capital Gain Tax Worksheet. Use the Qualified Dividends and Capital Gain Tax Work- sheet, later, to figure your tax if you do not have to use the Schedule D Tax Worksheet and if any of the following applies.

You reported qualified dividends on Form 1040, line 9b.

You do not have to file Schedule D and you reported capital gain distribu- tions on Form 1040, line 13.

You are filing Schedule D and Schedule D, lines 15 and 16, are both more than zero.

But if you are filing Form 2555 or 2555-EZ, you must use the Foreign Earned Income Tax Worksheet instead. Schedule J. If you had income from farming or fishing (including certain amounts received in connection with the Exxon Valdez litigation), your tax may be less if you choose to figure it using income averaging on Schedule J. Foreign Earned Income Tax Work­ sheet. If you claimed the foreign earned income exclusion, housing exclusion, or housing deduction on Form 2555 or 2555-EZ, you must figure your tax using the Foreign Earned Income Tax Work- sheet.

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2012 Form 1040—Line 40

Standard Deduction Worksheet for Dependents—Line 40 Keep for Your Records Use this worksheet only if someone can claim you, or your spouse if filing jointly, as a dependent. 1. Is your earned income* more than $650?

Yes. Add $300 to your earned income. Enter the total . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

No. Enter $950 2. Enter the amount shown below for your filing status.

Single or married filing separately—$5,950 Married filing jointly or qualifying widow(er)—$11,900 Head of household—$8,700

. . . . . . . . . . . . . . . . . . . . . . . . . . . 2.

3. Standard deduction. a. Enter the smaller of line 1 or line 2. If born after January 1, 1948, and not blind, stop here and

enter this amount on Form 1040, line 40. Otherwise, go to line 3b . . . . . . . . . . . . . . . . . . . . . . . . . . . 3a. b. If born before January 2, 1948, or blind, multiply the number on Form 1040, line 39a, by $1,150

($1,450 if single or head of household) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3b. c. Add lines 3a and 3b. Enter the total here and on Form 1040, line 40 . . . . . . . . . . . . . . . . . . . . . . . . . 3c.

* Earned income includes wages, salaries, tips, professional fees, and other compensation received for personal services you performed. It also includes any amount received as a scholarship that you must include in your income. Generally, your earned income is the total of the amount(s) you reported on Form 1040, lines 7, 12, and 18, minus the amount, if any, on line 27.

Standard Deduction Chart for People Who Were Born Before January 2, 1948, or Were Blind

Do not use this chart if someone can claim you, or your spouse if filing jointly, as a dependent. Instead, use the worksheet above.

Enter the number from the box on Form 1040, line 39a . . . . . . . . . . . . . . . . ▶ CAUTION!

Do not use the number of exemptions from line 6d.

IF your filing status is . . .

AND the number in the box above is . . .

THEN your standard deduction is . . .

Single 12 $7,400 8,850

Married filing jointly or Qualifying widow(er)

1 2 3 4

$13,050 14,200 15,350 16,500

Married filing separately

1 2 3 4

$7,100 8,250 9,400

10,550

Head of household 12 $10,150

11,600

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2012 Form 1040—Line 44

Foreign Earned Income Tax Worksheet—Line 44 Keep for Your Records

CAUTION !

If Form 1040, line 43, is zero, do not complete this worksheet. 1. Enter the amount from Form 1040, line 43 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1. 2. Enter the amount from your (and your spouse's, if filing jointly) Form 2555, lines 45 and 50, or

Form 2555-EZ, line 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2. 3. Add lines 1 and 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3. 4. Tax on the amount on line 3. Use the Tax Table, Tax Computation Worksheet, Qualified

Dividends and Capital Gain Tax Worksheet*, Schedule D Tax Worksheet*, or Form 8615, whichever applies. See the instructions for line 44 to see which tax computation method applies. (Do not use a second Foreign Earned Income Tax Worksheet to figure the tax on this line) . . . . . . . . 4.

5. Tax on the amount on line 2. If the amount on line 2 is less than $100,000, use the Tax Table to figure this tax. If the amount on line 2 is $100,000 or more, use the Tax Computation Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.

6. Subtract line 5 from line 4. Enter the result. If zero or less, enter -0-. Also include this amount on Form 1040, line 44 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.

*Enter the amount from line 3 above on line 1 of the Qualified Dividends and Capital Gain Tax Worksheet or Schedule D Tax Worksheet if you use either of those worksheets to figure the tax on line 4 above. Complete the rest of that worksheet through line 6 (line 10 if you use the Schedule D Tax Worksheet). Next, you must determine if you have a capital gain excess. To find out if you have a capital gain excess, subtract Form 1040, line 43, from line 6 of your Qualified Dividends and Capital Gain Tax Worksheet (line 10 of your Schedule D Tax Worksheet). If the result is more than zero, that amount is your capital gain excess. If you do not have a capital gain excess, complete the rest of either of those worksheets according to the worksheet's instructions. Then complete lines 5 and 6 above. If you have a capital gain excess, complete a second Qualified Dividends and Capital Gain Tax Worksheet or Schedule D Tax Worksheet (whichever applies) as instructed above but in its entirety and with the following additional modifications. Then complete lines 5 and 6 above. These modifications are to be made only for purposes of filling out the Foreign Earned Income Tax Worksheet above. 1. Reduce (but not below zero) the amount you would otherwise enter on line 3 of your Qualified Dividends and Capital Gain Tax

Worksheet or line 9 of your Schedule D Tax Worksheet by your capital gain excess. 2. Reduce (but not below zero) the amount you would otherwise enter on line 2 of your Qualified Dividends and Capital Gain Tax

Worksheet or line 6 of your Schedule D Tax Worksheet by any of your capital gain excess not used in (1) above. 3. Reduce (but not below zero) the amount on your Schedule D (Form 1040), line 18, by your capital gain excess. 4. Include your capital gain excess as a loss on line 16 of your Unrecaptured Section 1250 Gain Worksheet in the Instructions for

Schedule D (Form 1040).

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2012 Form 1040—Line 44

Qualified Dividends and Capital Gain Tax Worksheet—Line 44 Keep for Your Records See the earlier instructions for line 44 to see if you can use this worksheet to figure your tax. Before completing this worksheet, complete Form 1040 through line 43. If you do not have to file Schedule D and you received capital gain distributions, be sure you checked the box on line 13 of Form 1040.

Before you begin:

1. Enter the amount from Form 1040, line 43. However, if you are filing Form 2555 or 2555-EZ (relating to foreign earned income), enter the amount from line 3 of the Foreign Earned Income Tax Worksheet . . . . . . . . . . . . . . . . . . . . .1.

2. Enter the amount from Form 1040, line 9b* . . . . . . . 2. 3. Are you filing Schedule D?*

Yes. Enter the smaller of line 15 or 16 of Schedule D. If either line 15 or line 16 is blank or a loss, enter -0- 3.

No. Enter the amount from Form 1040, line 13 4. Add lines 2 and 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. 5. If filing Form 4952 (used to figure investment

interest expense deduction), enter any amount from line 4g of that form. Otherwise, enter -0- . . . . . . . . . . 5.

6. Subtract line 5 from line 4. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . 6. 7. Subtract line 6 from line 1. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . 7. 8. Enter:

$35,350 if single or married filing separately, $70,700 if married filing jointly or qualifying widow(er), $47,350 if head of household. . . . . . . . . . . . . . 8.

9. Enter the smaller of line 1 or line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9. 10. Enter the smaller of line 7 or line 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10. 11. Subtract line 10 from line 9. This amount is taxed at 0% . . . . . . . . . . . . . . . . . .11. 12. Enter the smaller of line 1 or line 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12. 13. Enter the amount from line 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13. 14. Subtract line 13 from line 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14. 15. Multiply line 14 by 15% (.15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15. 16. Figure the tax on the amount on line 7. If the amount on line 7 is less than $100,000, use the Tax

Table to figure this tax. If the amount on line 7 is $100,000 or more, use the Tax Computation Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.

17. Add lines 15 and 16 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17. 18. Figure the tax on the amount on line 1. If the amount on line 1 is less than $100,000, use the Tax

Table to figure this tax. If the amount on line 1 is $100,000 or more, use the Tax Computation Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.

19. Tax on all taxable income. Enter the smaller of line 17 or line 18. Also include this amount on Form 1040, line 44. If you are filing Form 2555 or 2555-EZ, do not enter this amount on Form 1040, line 44. Instead, enter it on line 4 of the Foreign Earned Income Tax Worksheet . . . . . . . . . 19.

*If you are filing Form 2555 or 2555-EZ, see the footnote in the Foreign Earned Income Tax Worksheet before completing this line.

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2012 Form 1040—Lines 45 Through 50

Line 45 Alternative Minimum Tax Use Form 6251 to figure the amount, if any, of your alternative minimum tax (AMT). Also see the Instructions for Form 6251 to see if you must file the form.

An electronic “AMT Assistant” is available on IRS.gov to help you see if you should fill out

Form 6251. Enter “AMT Assistant” in the search box.

Line 47 Foreign Tax Credit If you paid income tax to a foreign country, you may be able to take this credit. Generally, you must complete and attach Form 1116 to do so. Exception. You do not have to com- plete Form 1116 to take this credit if all of the following apply.

1. All of your foreign source gross income was from interest and dividends and all of that income and the foreign tax paid on it were reported to you on Form 1099-INT, Form 1099-DIV, or Schedule K-1 (or substitute statement).

2. The total of your foreign taxes was not more than $300 (not more than $600 if married filing jointly).

3. You held the stock or bonds on which the dividends or interest were paid for at least 16 days and were not obligated to pay these amounts to some- one else.

4. You are not filing Form 4563 or excluding income from sources within Puerto Rico.

5. All of your foreign taxes were: a. Legally owed and not eligible for

a refund or reduced tax rate under a tax treaty, and

b. Paid to countries that are recog- nized by the United States and do not support terrorism.

For more details on these require- ments, see the Instructions for Form 1116.

TIP

Do you meet all five requirements above?

Yes. Enter on line 47 the smaller of (a) your total foreign taxes, or (b) the amount on Form 1040, line 44.

No. See Form 1116 to find out if you can take the credit and, if you can, if you have to file Form 1116.

Line 48 Credit for Child and Dependent Care Expenses You may be able to take this credit if you paid someone to care for:

Your qualifying child under age 13 whom you claim as your dependent,

Your disabled spouse or any other disabled person who could not care for himself or herself, or

Your child whom you could not claim as a dependent because of the rules for Children of divorced or separa- ted parents in the instructions for line 6c.

For details, use TeleTax topic 602 or see Form 2441.

Line 49 Education Credits If you (or your dependent) paid qualified expenses in 2012 for yourself, your spouse, or your dependent to enroll in or attend an eligible educational institution, you may be able to take an education credit. See Form 8863 for details. How- ever, you cannot take an education cred- it if any of the following applies.

You, or your spouse if filing joint- ly, are claimed as a dependent on some- one else's (such as your parent's) 2012 tax return.

Your filing status is married filing separately.

The amount on Form 1040, line 38, is $90,000 or more ($180,000 or more if married filing jointly).

You are taking a deduction for tui- tion and fees on Form 1040, line 34, for the same student.

You, or your spouse, were a non- resident alien for any part of 2012 unless

your filing status is married filing joint- ly.

Line 50 Retirement Savings Contributions Credit (Saver's Credit) You may be able to take this credit if you, or your spouse if filing jointly, made (a) contributions, other than roll- over contributions, to a traditional or Roth IRA; (b) elective deferrals to a 401(k) or 403(b) plan (including desig- nated Roth contributions) or to a govern- mental 457, SEP, or SIMPLE plan; (c) voluntary employee contributions to a qualified retirement plan (including the federal Thrift Savings Plan); or (d) con- tributions to a 501(c)(18)(D) plan.

However, you cannot take the credit if either of the following applies.

1. The amount on Form 1040, line 38, is more than $28,750 ($43,125 if head of household; $57,500 if married filing jointly).

2. The person(s) who made the qualified contribution or elective defer- ral (a) was born after January 1, 1995, (b) is claimed as a dependent on some- one else's 2012 tax return, or (c) was a student (defined next).

You were a student if during any part of 5 calendar months of 2012 you:

Were enrolled as a full-time stu- dent at a school, or

Took a full-time, on-farm training course given by a school or a state, county, or local government agency.

A school includes a technical, trade, or mechanical school. It does not in- clude an on-the-job training course, cor- respondence school, or school offering courses only through the Internet.

For more details, use TeleTax topic 610 or see Form 8880.

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2012 Form 1040—Line 51

Yes. Subtract line 3 from line 2.

1.

4.

5.

1Number of qualifying children: $1,000. Enter the result.

Is the amount on line 2 more than the amount on line 3?

If the result is not a multiple of $1,000, increase it to the next multiple of $1,000. For example, increase $425 to $1,000, increase $1,025 to $2,000, etc.

No. Leave line 4 blank. Enter -0- on line 5, and go to line 6.

Multiply the amount on line 4 by 5% (.05). Enter the result.

4

2. 2Enter the amount from Form 1040, line 38.

3. Enter the amount shown below for your �ling status.

3

CAUTION

● Married �ling jointly — $110,000

● Single, head of household, or qualifying widow(er) — $75,000

● Married �ling separately — $55,000

No. STOP

6. Is the amount on line 1 more than the amount on line 5?

You cannot take the child tax credit on Form 1040, line 51. You also cannot take the additional child tax credit on Form 1040, line 65. Complete the rest of your Form 1040.

Yes. Subtract line 5 from line 1. Enter the result. Go to Part 2.

5

Part 1

6

2012 Child Tax Credit Worksheet—Line 51 Keep for Your Records

1. To be a qualifying child for the child tax credit, the child must be your dependent, under age 17 at the end of 2012, and meet all the conditions in Steps 1 through 3 in the instructions for line 6c. Make sure you checked the box on Form 1040, line 6c, column (4), for each qualifying child.

2. If you do not have a qualifying child, you cannot claim the child tax credit. 3. If your qualifying child has an ITIN instead of an SSN, �le Schedule 8812. 4. Do not use this worksheet, but use Pub. 972 instead, if:

a. You are claiming the adoption credit, mortgage interest credit, District of Columbia �rst-time homebuyer credit, or residential energy ef�cient property credit, b. You are excluding income from Puerto Rico, or c. You are �ling Form 2555, 2555-EZ, or 4563.

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2012 Form 1040—Line 51

2012 Child Tax Credit Worksheet—Continued

1040

Yes. STOP

9.

10.

Are the amounts on lines 7 and 8 the same?

You cannot take this credit because there is no tax to reduce. However, you may be able to take the additional child tax credit. See the TIP below.

No. Subtract line 8 from line 7.

Is the amount on line 6 more than the amount on line 9?

Yes. Enter the amount from line 9. Also, you may be able to take the additional child tax credit. See the TIP below.

No. Enter the amount from line 6.

This is your child tax credit.

Enter this amount on Form 1040, line 51.

You may be able to take the additional child tax credit on Form 1040, line 65, if you answered “Yes” on line 9 or line 10 above.

First, complete your Form 1040 through lines 64a and 64b.

Then, use Schedule 8812 to �gure any additional child tax credit.

9

10

7. 7Enter the amount from Form 1040, line 46.

8. Add any amounts from:

8

Keep for Your Records

TIP

Form 1040, line 47

+Form 1040, line 48

Enter the total.

Part 2

+Schedule R, line 22

Before you begin Part 2: Figure the amount of any credits you are claiming on Form 5695, Part II; Form 8834, Part I; Form 8910; Form 8936; or Schedule R.

+Form 1040, line 50

+Form 1040, line 49

+Form 8834, line 23

+Form 8910, line 22

+Form 8936, line 23

+Form 5695, line 32

●

●

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2012 Form 1040—Lines 52 Through 57

Line 52 Residential Energy Credits Residential energy efficient property credit. You may be able to take this credit by completing and attaching Form 5695 if you paid for any of the following during 2012.

Qualified solar electric property for use in your home located in the United States.

Qualified solar water heating prop- erty for use in your home located in the United States.

Qualified fuel cell property instal- led on or in connection with your main home located in the United States.

Qualified small wind energy prop- erty for use in connection with your home located in the United States.

Qualified geothermal heat pump property installed on or in connection with your home located in the United States. Nonbusiness energy property credit. You may be able to take this credit by completing and attaching Form 5695 for any of the following improvements to your main home located in the United States in 2012 if they are new and meet certain requirements for energy efficien- cy.

Any insulation material or system primarily designed to reduce heat gain or loss in your home.

Exterior windows (including sky- lights).

Exterior doors. A metal roof or asphalt roof with

pigmented coatings or cooling granules primarily designed to reduce the heat gain in your home.

You may also be able to take this credit for the cost of the following items if the items meet certain performance and quality standards.

Certain electric heat pump water heaters, electric heat pumps, central air conditioners, and natural gas, propane, or oil water heaters.

A qualified furnace or hot water boiler that uses natural gas, propane, or oil.

A stove that burns biomass fuel to heat your home or to heat water for use in your home.

An advanced main air circulating fan used in a natural gas, propane, or oil furnace. Condos and co­ops. If you are a mem- ber of a condominium management as- sociation for a condominium you own or a tenant-stockholder in a cooperative housing corporation, you are treated as having paid your proportionate share of any costs of such association or corpora- tion for purposes of these credits. More details. For details, see Form 5695.

Line 53 Other Credits Enter the total of the following credits on line 53 and check the appropriate box(es). Check all boxes that apply. If box c is checked, also enter the applica- ble form number. To find out if you can take the credit, see the form or publica- tion indicated.

General business credit. This credit consists of a number of credits that usu- ally apply only to individuals who are partners, shareholders in an S corpora- tion, self-employed, or who have rental property. See Form 3800 or Pub. 334.

Credit for prior year minimum tax. If you paid alternative minimum tax in a prior year, see Form 8801.

Mortgage interest credit. If a state or local government gave you a mort- gage credit certificate, see Form 8396.

Credit for the elderly or the disa- bled. See Schedule R.

Adoption credit. You may be able to take this credit if you paid expenses to adopt a child or you adopted a child with special needs and the adoption became final in 2012. See the Instructions for Form 8839.

District of Columbia first-time homebuyer credit. See Form 8859.

Qualified plug-in electric drive mo- tor vehicle credit. See Form 8936.

Qualified electric vehicle credit. You cannot claim this credit for a vehi- cle placed in service after 2006. You can claim this credit only if you have an electric vehicle passive activity credit carried forward from a prior year. See Form 8834, Part II.

Alternative motor vehicle credit. See Form 8910 if you placed a new fuel

cell motor vehicle in service during 2012.

Alternative fuel vehicle refueling property credit. See Form 8911.

Credit to holders of tax credit bonds. See Form 8912.

Other Taxes Line 57 Unreported Social Security and Medicare Tax from Forms 4137 and 8919 Enter the total of any taxes from Form 4137 and Form 8919. Check the appro- priate box(es). Form 4137. If you received tips of $20 or more in any month and you did not report the full amount to your employer, you must pay the social security and Medicare or railroad retirement (RRTA) tax on the unreported tips.

Do not include the value of any non- cash tips, such as tickets or passes. You do not pay social security and Medicare taxes or RRTA tax on these noncash tips.

To figure the social security and Medicare tax, use Form 4137. If you owe RRTA tax, contact your employer. Your employer will figure and collect the RRTA tax.

You may be charged a penalty equal to 50% of the social se- curity and Medicare or RRTA

tax due on tips you received but did not report to your employer.

Form 8919. If you are an employee who received wages from an employer who did not withhold social security and Medicare tax from your wages, use Form 8919 to figure your share of the unreported tax. Include on line 57 the amount from line 13 of Form 8919. In- clude the amount from line 6 of Form 8919 on Form 1040, line 7.

CAUTION !

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2012 Form 1040—Lines 58 Through 60

Line 58 Additional Tax on IRAs, Other Qualified Retirement Plans, etc. If any of the following apply, see Form 5329 and its instructions to find out if you owe this tax and if you must file Form 5329.

1. You received an early distribution from (a) an IRA or other qualified retire- ment plan, (b) an annuity, or (c) a modi- fied endowment contract entered into af- ter June 20, 1988, and the total distribu- tion was not rolled over in a qualified rollover contribution.

2. Excess contributions were made to your IRAs, Coverdell education sav- ings accounts (ESAs), Archer MSAs, or health savings accounts (HSAs).

3. You received taxable distribu- tions from Coverdell ESAs or qualified tuition programs.

4. You were born before July 1, 1941, and did not take the minimum re- quired distribution from your IRA or other qualified retirement plan.

Exception. If only item (1) applies and distribution code 1 is correctly shown in box 7 of Form 1099-R, you do not have to file Form 5329. Instead, multiply the taxable amount of the distribution by 10% (.10) and enter the result on line 58. The taxable amount of the distribution is the part of the distribution you reported on Form 1040, line 15b or line 16b, or on Form 4972. Also, enter “No” under the heading Other Taxes to the left of line 58 to indicate that you do not have to file Form 5329. But you must file Form 5329 if distribution code 1 is in- correctly shown in box 7 of Form 1099-R or you qualify for an exception, such as the exceptions for qualified medical expenses, qualified higher edu- cation expenses, qualified first-time homebuyer distributions, or a qualified reservist distribution.

Line 59a Household Employment Taxes Enter the household employment taxes you owe for having a household em-

ployee. If any of the following apply, see Schedule H and its instructions to find out if you owe these taxes.

1. You paid any one household em- ployee (defined below) cash wages of $1,800 or more in 2012. Cash wages in- clude wages paid by check, money or- der, etc. But do not count amounts paid to an employee who was under age 18 at any time in 2012 and was a student.

2. You withheld federal income tax during 2012 at the request of any house- hold employee.

3. You paid total cash wages of $1,000 or more in any calendar quarter of 2011 or 2012 to household employ- ees.

Any person who does household work is a household employee if you can control what will be done and how it will be done. Household work includes work done in or around your home by babysit- ters, nannies, health aides, maids, yard workers, and similar domestic workers.

Line 59b First-time Homebuyer Credit Repayment Enter the first-time homebuyer credit you have to repay if you:

Disposed of the home within 36 months after buying it,

Stopped using the home as your main home within 36 months after buy- ing it, or

Bought the home in 2008.

If you bought the home in 2008 and owned and used it as your main home for all of 2012, you can enter your 2012 repayment on this line without attaching Form 5405.

See the Form 5405 instructions for details and for exceptions to the repay- ment rule. Also see the Form 5405 in- structions if the home you bought was destroyed, condemned, or disposed of under threat of condemnation and you did not buy a new home within 2 years.

Line 60 Other Taxes Use line 60 to report any taxes not re- ported elsewhere on your return or other schedules. To find out if you owe the

tax, see the form or publication indica- ted. In the space next to line 60, enter the amount of the tax and the code that identifies it. If you need more room, at- tach a statement listing the amount of each tax and the code. Enter on line 60 the total of all of the following taxes you owe.

1. Additional tax on health savings account (HSA) distributions (see Form 8889, Part II). Identify as “HSA.”

2. Additional tax on an HSA be- cause you did not remain an eligible in- dividual during the testing period (see Form 8889, Part III). Identify as “HDHP.”

3. Additional tax on Archer MSA distributions (see Form 8853). Identify as “MSA.”

4. Additional tax on Medicare Ad- vantage MSA distributions (see Form 8853). Identify as “Med MSA.”

5. Recapture of the following cred- its.

a. Investment credit (see Form 4255). Identify as “ICR.”

b. Low-income housing credit (see Form 8611). Identify as “LIHCR.”

c. Qualified plug-in electric vehicle credit (see Form 8834, Part I). Identify as “8834R.”

d. Indian employment credit (see Form 8845). Identify as “IECR.”

e. New markets credit (see Form 8874). Identify as “NMCR.”

f. Credit for employer-provided child care facilities (see Form 8882). Identify as “ECCFR.”

g. Alternative motor vehicle credit (see Form 8910). Identify as “AMVCR.”

h. Alternative fuel vehicle refueling property credit (see Form 8911). Identi- fy as “ARPCR.”

i. Qualified plug-in electric drive motor vehicle credit (see Form 8936). Identify as “8936R.”

6. Recapture of federal mortgage subsidy. If you sold your home in 2012 and it was financed (in whole or in part) from the proceeds of any tax-exempt qualified mortgage bond or you claimed the mortgage interest credit, see Form 8828. Identify as “FMSR.”

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2012 Form 1040—Lines 60 Through 63

7. Recapture of COBRA premium assistance. If you received premium as- sistance under COBRA continuation coverage that covered you, your spouse, or any of your dependents, and your modified adjusted gross income is more than $125,000 ($250,000 if married fil- ing jointly), see Pub. 502. Identify as “COBRA.”

8. Section 72(m)(5) excess benefits tax (see Pub. 560). Identify as “Sec. 72(m)(5).”

9. Uncollected social security and Medicare or RRTA tax on tips or group-term life insurance. This tax should be shown in box 12 of Form W-2 with codes A and B or M and N. Identi- fy as “UT.”

10. Golden parachute payments. If you received an excess parachute pay- ment (EPP), you must pay a 20% tax on it. This tax should be shown in box 12 of Form W-2 with code K. If you received a Form 1099-MISC, the tax is 20% of the EPP shown in box 13. Identify as “EPP.”

11. Tax on accumulation distribution of trusts (see Form 4970). Identify as “ADT.”

12. Excise tax on insider stock com- pensation from an expatriated corpora- tion. See section 4985. Identify as “ISC.”

13. Interest on the tax due on install- ment income from the sale of certain residential lots and timeshares. Identify as “453(l)(3).”

14. Interest on the deferred tax on gain from certain installment sales with a sales price over $150,000. Identify as “453A(c).”

15. Additional tax on recapture of a charitable contribution deduction relat- ing to a fractional interest in tangible personal property. See Pub. 526. Identi- fy as “FITPP.”

16. Look-back interest under section 167(g) or 460(b). See Form 8697 or 8866. Identify as “From Form 8697” or “From Form 8866.”

17. Any negative amount on Form 8885, line 5, because of advance pay- ments of the health coverage tax credit you received for months you were not eligible. Enter this additional tax as a positive amount. Identify as “HCTC.”

18. Additional tax on income you re- ceived from a nonqualified deferred compensation plan that fails to meet the requirements of section 409A. This in- come should be shown in box 12 of Form W-2 with code Z, or in box 15b of Form 1099-MISC. The tax is 20% of the amount required to be included in in- come plus an interest amount deter- mined under section 409A(a)(1)(B)(ii). See section 409A(a)(1)(B) for details. Identify as “NQDC.”

19. Additional tax on compensation you received from a nonqualified defer- red compensation plan described in sec- tion 457A if the compensation would have been includible in your income in an earlier year except that the amount was not determinable until 2012. The tax is 20% of the amount required to be included in income plus an interest amount determined under section 457A(c)(2). See section 457A for de- tails. Identify as “457A.”

20. Tax on noneffectively connected income for any part of the year you were a nonresident alien (see the Instructions for Form 1040NR). Identify as “From Form 1040NR.”

Payments Line 62 Federal Income Tax Withheld Add the amounts shown as federal in- come tax withheld on your Forms W-2, W-2G, and 1099-R. Enter the total on line 62. The amount withheld should be shown in box 2 of Form W-2 or W-2G, and in box 4 of Form 1099-R. Attach Forms W-2G and 1099-R to the front of your return if federal income tax was withheld.

If you received a 2012 Form 1099 showing federal income tax withheld on dividends, taxable or tax-exempt interest income, unemployment compensation, social security benefits, or other income you received, include the amount with- held in the total on line 62. This should be shown in box 4 of Form 1099 or box 6 of Form SSA-1099.

Also include on line 62 any federal income tax withheld that is shown on a Schedule K-1.

Line 63 2012 Estimated Tax Payments Enter any estimated federal income tax payments you made for 2012. Include any overpayment that you applied to your 2012 estimated tax from:

Your 2011 return, or An amended return (Form 1040X).

If you and your spouse paid joint esti- mated tax but are now filing separate in- come tax returns, you can divide the amount paid in any way you choose as long as you both agree. If you cannot agree, you must divide the payments in proportion to each spouse's individual tax as shown on your separate returns for 2012. For an example of how to do this, see Pub. 505. You may want to at- tach an explanation of how you and your spouse divided the payments. Be sure to show both social security numbers (SSNs) in the space provided on the sep- arate returns. If you or your spouse paid separate estimated tax but you are now filing a joint return, add the amounts you each paid. Follow these instructions even if your spouse died in 2012 or in 2013 before filing a 2012 return. Divorced taxpayers. If you got di- vorced in 2012 and you made joint esti- mated tax payments with your former spouse, enter your former spouse's SSN in the space provided on the front of Form 1040. If you were divorced and re- married in 2012, enter your present spouse's SSN in the space provided on the front of Form 1040. Also, under the heading Payments to the left of line 63, enter your former spouse's SSN, fol- lowed by “DIV.” Name change. If you changed your name because of marriage, divorce, etc., and you made estimated tax payments using your former name, attach a state- ment to the front of Form 1040. On the statement, explain all the payments you and your spouse made in 2012 and the name(s) and SSN(s) under which you made them.

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2012 Form 1040—Lines 64a and 64b

Lines 64a and 64b—Earned Income Credit (EIC) What Is the EIC? The EIC is a credit for certain people who work. The credit may give you a refund even if you do not owe any tax.

To Take the EIC: Follow the steps below. Complete the worksheet that applies to you or let the IRS

figure the credit for you. If you have a qualifying child, complete and attach Sched-

ule EIC. For help in determining if you are eligible for the EIC, go to www.irs.gov/eitc and click on “EITC Assistant.” This service is available in English and Spanish.

If you take the EIC even though you are not eligible and it is determined that your error is due to reckless or intentional disregard of the EIC rules, you will not

be allowed to take the credit for 2 years even if you are other- wise eligible to do so. If you fraudulently take the EIC, you will not be allowed to take the credit for 10 years. See Form 8862, who must file, later. You may also have to pay penalties.

All Filers 1. If, in 2012:

3 or more children lived with you, is the amount on Form 1040, line 38, less than $45,060 ($50,270 if married filing jointly)? 2 children lived with you, is the amount on Form 1040, line 38, less than $41,952 ($47,162 if married filing jointly)? 1 child lived with you, is the amount on Form 1040, line 38, less than $36,920 ($42,130 if married filing jointly)? No children lived with you, is the amount on Form 1040, line 38, less than $13,980 ($19,190 if married filing jointly)?

Yes. Continue �

No. STOP You cannot take the credit.

2. Do you, and your spouse if filing a joint return, have a social security number that allows you to work or is valid for EIC purposes (explained later under Definitions and Special Rules)?

Yes. Continue �

No. STOP You cannot take the credit. Enter “No” on the dotted line next to line 64a.

3. Is your filing status married filing separately? Yes. STOP You cannot take the credit.

No. Continue �

CAUTION !

Step 1

4. Are you filing Form 2555 or 2555-EZ (relating to foreign earned income)?

Yes. STOP You cannot take the credit.

No. Continue �

5. Were you or your spouse a nonresident alien for any part of 2012?

Yes. See Nonresident aliens, later, under Definitions and Special Rules.

No. Go to Step 2.

Investment Income 1. Add the amounts from

Form 1040: Line 8a

Line 8b +

Line 9a +

Line 13* +

Investment Income =

*If line 13 is a loss, enter -0-.

2. Is your investment income more than $3,200? Yes. Continue

� No. Skip question 3; go to question 4.

3. Are you filing Form 4797 (relating to sales of business property)?

Yes. See Form 4797 filers, later, under Definitions and Special Rules.

No. STOP You cannot take the credit.

4. Do any of the following apply for 2012? You are filing Schedule E. You are reporting income from the rental of personal property not used in a trade or business. You are reporting income on Form 1040, line 21, from Form 8814 (relating to election to report child's interest and dividends).

Yes. You must use Worksheet 1 in Pub. 596 to see if you can take the credit.

No. Go to Step 3.

Step 2

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2012 Form 1040—Lines 64a and 64b

Qualifying Child A qualifying child for the EIC is a child who is your...

Son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, half brother, half sister, or a descendant of any of them (for example, your

grandchild, niece, or nephew)

AND

was ...

Under age 19 at the end of 2012 and younger than you (or your spouse, if filing jointly)

or

Under age 24 at the end of 2012, a student (defined later), and younger than you (or your spouse, if filing jointly)

or Any age and permanently and totally disabled (defined later)

AND

Who is not filing a joint return for 2012 or is filing a joint return for 2012 only to claim a refund of withheld income

tax or estimated tax paid (see Pub. 596 for examples)

AND

Who lived with you in the United States for more than half of 2012. If the child did not live with you for the required time, see Exception to time

lived with you, later.

CAUTION !

If the child meets the conditions to be a qualifying child of any other person (other than your spouse if filing a joint return) for 2012, see

Qualifying child of more than one person, later. If the child was married, see Married child, later.

1. Do you have at least one child who meets the conditions to be your qualifying child?

Yes. The child must have a valid social security number (SSN) as defined later, unless the child was born and died in 2012. If at least one qualifying child has a valid SSN (or was born or died in 2012), go to question 2. Otherwise, you cannot take the credit.

No. Skip questions 2 and 3; go to Step 4.

2. Are you filing a joint return for 2012? Yes. Skip question 3 and Step 4; go to Step 5.

No. Continue �

Step 3 3. Could you be a qualifying child of another person for 2012? (Check “No” if the other person is not required to file, and is not filing, a 2012 tax return or is filing a 2012 return only to claim a refund of withheld income tax or estimated tax paid (see Pub. 596 for examples).)

Yes. STOP You cannot take the credit. Enter “No” on the dotted line next to line 64a.

No. Skip Step 4; go to Step 5.

Filers Without a Qualifying Child

1. Is the amount on Form 1040, line 38, less than $13,980 ($19,190 if married filing jointly)?

Yes. Continue �

No. STOP You cannot take the credit.

2. Were you, or your spouse if filing a joint return, at least age 25 but under age 65 at the end of 2012? (Check “Yes” if you, or your spouse if filing a joint return, were born after December 31, 1947, and before January 2, 1988.) If your spouse died in 2012, see Pub. 596 before you answer.

Yes. Continue �

No. STOP You cannot take the credit.

3. Was your main home, and your spouse's if filing a joint return, in the United States for more than half of 2012? Members of the military stationed outside the United States, see Members of the military, later, before you answer.

Yes. Continue �

No. STOP You cannot take the credit. Enter “No” on the dotted line next to line 64a.

4. Are you filing a joint return for 2012? Yes. Skip questions 5 and 6; go to Step 5.

No. Continue �

5. Could you be a qualifying child of another person for 2012? (Check “No” if the other person is not required to file, and is not filing, a 2012 tax return or is filing a 2012 return only to claim a refund of withheld income tax or estimated tax paid (see Pub. 596 for examples).)

Yes. STOP You cannot take the credit. Enter “No” on the dotted line next to line 64a.

No. Continue �

Step 4

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2012 Form 1040—Lines 64a and 64b

6. Can you be claimed as a dependent on someone else's 2012 tax return?

Yes. STOP You cannot take the credit.

No. Go to Step 5.

Earned Income 1. Are you filing Schedule SE because you were a member of

the clergy or you had church employee income of $108.28 or more?

Yes. See Clergy or Church employees, whichever applies.

No. Continue �

2. Figure earned income: Form 1040, line 7

Subtract, if included on line 7, any: • Taxable scholarship or fellowship grant

not reported on a Form W-2. • Amount received for work performed

while an inmate in a penal institution (enter “PRI” and the amount subtracted on the dotted line next to Form 1040, line 7).

• Amount received as a pension or annuity from a nonqualified deferred compensation plan or a nongovernmental section 457 plan (enter “DFC” and the amount subtracted on the dotted line next to Form 1040, line 7). This amount may be shown in box 11 of Form W-2. If you received such an amount but box 11 is blank, contact your employer for the amount received as a pension or annuity.

–

Add all of your nontaxable combat pay if you elect to include it in earned income. Also enter this amount on Form 1040, line 64b. See Combat pay, nontaxable later. +

CAUTION !

Electing to include nontaxable combat pay may increase or decrease your EIC. Figure the credit with and without your nontaxable combat pay before making the election.

Earned Income =

Step 5

3. Were you self-employed at any time in 2012, or are you filing Schedule SE because you were a member of the clergy or you had church employee income, or are you filing Schedule C or C-EZ as a statutory employee?

Yes. Skip question 4 and Step 6; go to Worksheet B.

No. Continue �

4. If you have: 3 or more qualifying children, is your earned income less than $45,060 ($50,270 if married filing jointly)? 2 qualifying children, is your earned income less than $41,952 ($47,162 if married filing jointly)? 1 qualifying child, is your earned income less than $36,920 ($42,130 if married filing jointly)? No qualifying children, is your earned income less than $13,980 ($19,190 if married filing jointly)?

Yes. Go to Step 6. No. STOP You cannot take the credit.

How To Figure the Credit 1. Do you want the IRS to figure the credit for you?

Yes. See Credit figured by the IRS, later.

No. Go to Worksheet A.

Definitions and Special Rules Adopted child. An adopted child is always treated as your own child. An adopted child includes a child lawfully placed with you for legal adoption.

Church employees. Determine how much of the amount on Form 1040, line 7, was also reported on Schedule SE, Section B, line 5a. Subtract that amount from the amount on Form 1040, line 7, and enter the result in the first space of Step 5, line 2. Be sure to answer “Yes” to question 3 in Step 5. Clergy. The following instructions apply to ministers, mem- bers of religious orders who have not taken a vow of poverty, and Christian Science practitioners. If you are filing Sched- ule SE and the amount on line 2 of that schedule includes an amount that was also reported on Form 1040, line 7:

1. Enter “Clergy” on the dotted line next to Form 1040, line 64a.

2. Determine how much of the amount on Form 1040, line 7, was also reported on Schedule SE, Section A, line 2, or Section B, line 2.

3. Subtract that amount from the amount on Form 1040, line 7. Enter the result in the first space of Step 5, line 2.

4. Be sure to answer “Yes” to question 3 in Step 5.

Combat pay, nontaxable. If you were a member of the U.S. Armed Forces who served in a combat zone, certain pay is ex- cluded from your income. See Combat Zone Exclusion in Pub. 3. You can elect to include this pay in your earned income when figuring the EIC. The amount of your nontaxable combat pay should be shown in box 12 of Form(s) W-2 with code Q. If you

Step 6

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2012 Form 1040—Lines 64a and 64b

are filing a joint return and both you and your spouse received nontaxable combat pay, you can each make your own election.

Credit figured by the IRS. To have the IRS figure your EIC: 1. Enter “EIC” on the dotted line next to Form 1040,

line 64a. 2. Be sure you enter the nontaxable combat pay you elect to

include in earned income on Form 1040, line 64b. See Combat pay, nontaxable, above.

3. If you have a qualifying child, complete and attach Schedule EIC. If your EIC for a year after 1996 was reduced or disallowed, see Form 8862, who must file, later.

Exception to time lived with you. Temporary absences by you or the child for special circumstances, such as school, vacation, business, medical care, military service, or detention in a juve- nile facility, count as time the child lived with you. Also see Kidnapped child in the instructions for line 6c or Members of the military, later. A child is considered to have lived with you for more than half of 2012 if the child was born or died in 2012 and your home was this child's home for more than half the time he or she was alive in 2012.

Form 4797 filers. If the amount on Form 1040, line 13, in- cludes an amount from Form 4797, you must use Worksheet 1 in Pub. 596 to see if you can take the EIC. Otherwise, stop; you cannot take the EIC. Form 8862, who must file. You must file Form 8862 if your EIC for a year after 1996 was reduced or disallowed for any reason other than a math or clerical error. But do not file Form 8862 if either of the following applies.

You filed Form 8862 for another year, the EIC was al- lowed for that year, and your EIC has not been reduced or disal- lowed again for any reason other than a math or clerical error.

You are taking the EIC without a qualifying child and the only reason your EIC was reduced or disallowed in the other year was because it was determined that a child listed on Sched- ule EIC was not your qualifying child. Also, do not file Form 8862 or take the credit for the:

2 years after the most recent tax year for which there was a final determination that your EIC claim was due to reckless or intentional disregard of the EIC rules, or

10 years after the most recent tax year for which there was a final determination that your EIC claim was due to fraud. Foster child. A foster child is any child placed with you by an authorized placement agency or by judgment, decree, or other order of any court of competent jurisdiction. For more details on authorized placement agencies, see Pub. 596.

Married child. A child who was married at the end of 2012 is a qualifying child only if (a) you can claim him or her as your dependent on Form 1040, line 6c, or (b) you could have claimed him or her as your dependent except for the special rule for Children of divorced or separated parents in the instructions for line 6c. Members of the military. If you were on extended active duty outside the United States, your main home is considered to be in the United States during that duty period. Extended active duty

is military duty ordered for an indefinite period or for a period of more than 90 days. Once you begin serving extended active duty, you are considered to be on extended active duty even if you do not serve more than 90 days.

Nonresident aliens. If your filing status is married filing joint- ly, go to Step 2. Otherwise, stop; you cannot take the EIC. Enter “No” on the dotted line next to line 64a.

Permanently and totally disabled. A person is permanently and totally disabled if, at any time in 2012, the person could not engage in any substantial gainful activity because of a physical or mental condition and a doctor has determined that this condi- tion (a) has lasted or can be expected to last continuously for at least a year, or (b) can be expected to lead to death.

Qualifying child of more than one person. Even if a child meets the conditions to be the qualifying child of more than one person, only one person can claim the child as a qualifying child for all of the following tax benefits, unless the special rule for Children of divorced or separated parents in the instructions for line 6c applies.

1. Dependency exemption (line 6c). 2. Child tax credits (lines 51 and 65). 3. Head of household filing status (line 4). 4. Credit for child and dependent care expenses (line 48). 5. Exclusion for dependent care benefits (Form 2441, Part

III). 6. Earned income credit (lines 64a and 64b).

No other person can take any of the six tax benefits just listed unless he or she has a different qualifying child. If you and any other person can claim the child as a qualifying child, the fol- lowing rules apply.

If only one of the persons is the child's parent, the child is treated as the qualifying child of the parent.

If the parents do not file a joint return together but both pa- rents claim the child as a qualifying child, the IRS will treat the child as the qualifying child of the parent with whom the child lived for the longer period of time in 2012. If the child lived with each parent for the same amount of time, the IRS will treat the child as the qualifying child of the parent who had the high- er adjusted gross income (AGI) for 2012.

If no parent can claim the child as a qualifying child, the child is treated as the qualifying child of the person who had the highest AGI for 2012.

If a parent can claim the child as a qualifying child but no parent does so claim the child, the child is treated as the qualify- ing child of the person who had the highest AGI for 2012, but only if that person's AGI is higher than the highest AGI of any parent of the child who can claim the child.

Example. Your daughter meets the conditions to be a quali- fying child for both you and your mother. Your daughter does not meet the conditions to be a qualifying child of any other person, including her other parent. Under the rules above, you can claim your daughter as a qualifying child for all of the six tax benefits listed here for which you otherwise qualify. Your mother cannot claim any of the six tax benefits listed here un- less she has a different qualifying child. However, if your

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2012 Form 1040—Lines 64a and 64b

mother's AGI is higher than yours and you do not claim your daughter as a qualifying child, your daughter is the qualifying child of your mother.

For more details and examples, see Pub. 596. If you will not be taking the EIC with a qualifying child, en-

ter “No” on the dotted line next to line 64a. Otherwise, go to Step 3, question 1.

Social security number (SSN). For the EIC, a valid SSN is a number issued by the Social Security Administration unless “Not Valid for Employment” is printed on the social security card and the number was issued solely to allow the recipient of the SSN to apply for or receive a federally funded benefit. How- ever, if “Valid for Work Only With DHS Authorization” is prin- ted on your social security card, your SSN is valid for EIC pur- poses only as long as the DHS authorization is still valid.

To find out how to get an SSN, see Social Security Number (SSN) near the beginning of these instructions. If you will not have an SSN by the date your return is due, see What if You Cannot File on Time? Student. A student is a child who during any part of 5 calendar months of 2012 was enrolled as a full-time student at a school,

or took a full-time, on-farm training course given by a school or a state, county, or local government agency. A school includes a technical, trade, or mechanical school. It does not include an on-the-job training course, correspondence school, or school of- fering courses only through the Internet.

Welfare benefits, effect of credit on. Any refund you receive as a result of taking the EIC cannot be counted as income when determining if you or anyone else is eligible for benefits or as- sistance, or how much you or anyone else can receive, under any federal program or under any state or local program fi- nanced in whole or in part with federal funds. These programs include Temporary Assistance for Needy Families (TANF), Medicaid, Supplemental Security Income (SSI), and Supple- mental Nutrition Assistance Program (food stamps). In addition, when determining eligibility, the refund cannot be counted as a resource for at least 12 months after you receive it. Check with your local benefit coordinator to find out if your refund will af- fect your benefits.

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2012 Form 1040—Lines 64a and 64b

AWorksheet —2012 EIC—Lines 64a and 64b

1040

Yes. Skip line 5; enter the amount from line 2 on line 6.

STOP

Keep for Your Records

Before you begin:

1.

2.

3.

4.

5.

1Enter your earned income from Step 5.

Enter the amount from Form 1040, line 38.

Are the amounts on lines 3 and 1 the same?

No. Go to line 5.

If you have:

Yes. Leave line 5 blank; enter the amount from line 2 on line 6.

No. Look up the amount on line 3 in the EIC Table to find the credit. Be sure you use the correct column for your filing status and the number of children you have. Enter the credit here.

Enter this amount on Form 1040, line 64a.

3

6 Part 3

Part 1

Part 2

All Filers Using Worksheet A

Filers Who Answered “No” on Line 4

Your Earned Income Credit

2

● No qualifying children, is the amount on line 3 less than $7,800 ($13,000 if married filing jointly)?

● 1 or more qualifying children, is the amount on line 3 less than $17,100 ($22,300 if married filing jointly)?

Look at the amounts on lines 5 and 2. Then, enter the smaller amount on line 6.

5

6. This is your earned income credit.

Reminder—

If you have a qualifying child, complete and attach Schedule EIC.

If your EIC for a year after 1996 was reduced or disallowed, see Form 8862, who must �le, earlier, to find out if you must file Form 8862 to take the credit for 2012.

EIC

1040

CAUTION

Be sure you are using the correct worksheet. Use this worksheet only if you answered “No” to Step 5, question 3. Otherwise, use Worksheet B.

Look up the amount on line 1 above in the EIC Table (right after Worksheet B) to �nd the credit. Be sure you use the correct column for your �ling status and the number of children you have. Enter the credit here.

If line 2 is zero, You cannot take the credit. Enter “No” on the dotted line next to line 64a.

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2012 Form 1040—Lines 64a and 64b

BWorksheet —2012 EIC—Lines 64a and 64b

STOP

Keep for Your Records

Use this worksheet if you answered “Yes” to Step 5, question 3. Complete the parts below (Parts 1 through 3) that apply to you. Then, continue to Part 4.

1a.

2.

3.

1a Enter the amount from Schedule SE, Section A, line 3, or Section B, line 3, whichever applies.

Subtract line 1d from 1c.

Do not include on these lines any statutory employee income, any net pro�t from services performed as a notary public, any amount exempt from self-employment tax as the result of the �ling and approval of Form 4029 or Form 4361, or any other amounts exempt from self-employment tax.

Yes. If you want the IRS to �gure your credit, see Credit �gured by the IRS, earlier. If you want to �gure the credit yourself, enter the amount from line 4b on line 6 of this worksheet.

Part 3

Part 1

Part 2

Self-Employed, Members of the Clergy, and People With Church Employee Income Filing Schedule SE

Self-Employed NOT Required To File Schedule SE

Statutory Employees Filing Schedule C or C-EZ

● 2 qualifying children, is line 4b less than $41,952 ($47,162 if married �ling jointly)? ● 1 qualifying child, is line 4b less than $36,920 ($42,130 if married �ling jointly)?

If you are married �ling a joint return, include your spouse’s amounts, if any, with yours to �gure the amounts to enter in Parts 1 through 3.

1e

c.

d.

e.

1c

Enter any amount from Schedule SE, Section B, line 4b, and line 5a.

1d

Combine lines 1a and 1b.

Enter the amount from Schedule SE, Section A, line 6, or Section B, line 13, whichever applies.

=

=

For example, your net earnings from self-employment were less than $400.

a. 2aEnter any net farm pro�t or (loss) from Schedule F, line 34, and from farm partnerships, Schedule K-1 (Form 1065), box 14, code A*.

b.

2b

Enter any net pro�t or (loss) from Schedule C, line 31; Schedule C-EZ, line 3; Schedule K-1 (Form 1065), box 14, code A (other than farming); and Schedule K-1 (Form 1065-B), box 9, code J1*.

+

Combine lines 2a and 2b. 2cc. =

Enter the amount from Schedule C, line 1, or Schedule C-EZ, line 1, that you are �ling as a statutory employee.

3

Part 4

All Filers Using Worksheet B

Note. If line 4b includes income on which you should have paid self- employment tax but did not, we may reduce your credit by the amount of self-employment tax not paid.

4a. Enter your earned income from Step 5.

4b b. Combine lines 1e, 2c, 3, and 4a. This is your total earned income.

5. If you have:

● No qualifying children, is line 4b less than $13,980 ($19,190 if married �ling jointly)?

No. You cannot take the credit. Enter “No” on the dotted line next to line 64a.

*If you have any Schedule K-1 amounts, complete the appropriate line(s) of Schedule SE, Section A. Reduce the Schedule K-1 amounts as described in the Partner’s Instructions for Schedule K-1. Enter your name and social security number on Schedule SE and attach it to your return.

If line 4b is zero or less, You cannot take the credit. Enter “No” on the dotted line next to line 64a.

4a

STOP

● 3 or more qualifying children, is line 4b less than $45,060 ($50,270 if married �ling jointly)?

b. 1b+

–

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2012 Form 1040—Lines 64a and 64b

BWorksheet —2012 EIC—Lines 64a and 64b—Continued

1040

Skip line 10; enter the amount from line 7 on line 11.Yes.

STOP

Keep for Your Records

6.

7.

8.

9.

10.

6Enter your total earned income from Part 4, line 4b.

Look up the amount on line 6 above in the EIC Table to �nd the credit. Be sure you use the correct column for your �ling status and the number of children you have. Enter the credit here.

Enter the amount from Form 1040, line 38.

Are the amounts on lines 8 and 6 the same?

Go to line 10.No.

If you have:

Leave line 10 blank; enter the amount from line 7 on line 11.Yes.

No. Look up the amount on line 8 in the EIC Table to �nd the credit. Be sure you use the correct column for your �ling status and the number of children you have. Enter the credit here.

Enter this amount on Form 1040, line 64a.

8

11

Part 5

Part 7

All Filers Using Worksheet B

Your Earned Income Credit

7

If line 7 is zero, You cannot take the credit. Enter “No” on the dotted line next to line 64a.

● No qualifying children, is the amount on line 8 less than $7,800 ($13,000 if married �ling jointly)?

● 1 or more qualifying children, is the amount on line 8 less than $17,100 ($22,300 if married �ling jointly)?

Look at the amounts on lines 10 and 7. Then, enter the smaller amount on line 11.

10

This is your earned income credit.

Reminder—

If you have a qualifying child, complete and attach Schedule EIC.

If your EIC for a year after 1996 was reduced or disallowed, see Form 8862, who must �le, earlier, to find out if you must file Form 8862 to take the credit for 2012.

EIC

1040

Part 6

Filers Who Answered “No” on Line 9

CAUTION

11.

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2012 Earned Income Credit (EIC) Table Caution. This is not a tax table.

At least But less than

Two children

Your credit is—

One child

And your filing status is—

No children

If the amount you are looking up from the worksheet is—

Single, head of household, or qualifying widow(er) and you have—

2,400 2,450 186 825 970 2,450 2,500 189 842 990

Three children

1,091 1,114

1. To find your credit, read down the “At least - But less than” columns and find the line that includes the amount you were told to look up from your EIC Worksheet.

2. Then, go to the column that includes your filing status and the number of qualifying children you have. Enter the credit from that column on your EIC Worksheet.

Example. If your filing status is single, you have one qualifying child, and the amount you are looking up from your EIC Worksheet is $2,455, you would enter $842.

And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is–

. . . . . . . . . .

$1 $50 $2 $9 $10 $11 $2 $9 $10 $11 50 100 6 26 30 34 6 26 30 34

100 150 10 43 50 56 10 43 50 56 150 200 13 60 70 79 13 60 70 79 200 250 17 77 90 101 17 77 90 101 250 300 21 94 110 124 21 94 110 124 300 350 25 111 130 146 25 111 130 146 350 400 29 128 150 169 29 128 150 169 400 450 33 145 170 191 33 145 170 191 450 500 36 162 190 214 36 162 190 214 500 550 40 179 210 236 40 179 210 236 550 600 44 196 230 259 44 196 230 259 600 650 48 213 250 281 48 213 250 281 650 700 52 230 270 304 52 230 270 304 700 750 55 247 290 326 55 247 290 326 750 800 59 264 310 349 59 264 310 349 800 850 63 281 330 371 63 281 330 371 850 900 67 298 350 394 67 298 350 394 900 950 71 315 370 416 71 315 370 416 950 1,000 75 332 390 439 75 332 390 439

1,000 1,050 78 349 410 461 78 349 410 461 1,050 1,100 82 366 430 484 82 366 430 484 1,100 1,150 86 383 450 506 86 383 450 506 1,150 1,200 90 400 470 529 90 400 470 529 1,200 1,250 94 417 490 551 94 417 490 551 1,250 1,300 98 434 510 574 98 434 510 574 1,300 1,350 101 451 530 596 101 451 530 596 1,350 1,400 105 468 550 619 105 468 550 619 1,400 1,450 109 485 570 641 109 485 570 641 1,450 1,500 113 502 590 664 113 502 590 664 1,500 1,550 117 519 610 686 117 519 610 686 1,550 1,600 120 536 630 709 120 536 630 709 1,600 1,650 124 553 650 731 124 553 650 731 1,650 1,700 128 570 670 754 128 570 670 754 1,700 1,750 132 587 690 776 132 587 690 776 1,750 1,800 136 604 710 799 136 604 710 799 1,800 1,850 140 621 730 821 140 621 730 821 1,850 1,900 143 638 750 844 143 638 750 844 1,900 1,950 147 655 770 866 147 655 770 866 1,950 2,000 151 672 790 889 151 672 790 889 2,000 2,050 155 689 810 911 155 689 810 911 2,050 2,100 159 706 830 934 159 706 830 934 2,100 2,150 163 723 850 956 163 723 850 956 2,150 2,200 166 740 870 979 166 740 870 979 2,200 2,250 170 757 890 1,001 170 757 890 1,001 2,250 2,300 174 774 910 1,024 174 774 910 1,024 2,300 2,350 178 791 930 1,046 178 791 930 1,046 2,350 2,400 182 808 950 1,069 182 808 950 1,069 2,400 2,450 186 825 970 1,091 186 825 970 1,091 2,450 2,500 189 842 990 1,114 189 842 990 1,114

(Continued)

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Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is–

2,500 2,550 193 859 1,010 1,136 193 859 1,010 1,136 2,550 2,600 197 876 1,030 1,159 197 876 1,030 1,159 2,600 2,650 201 893 1,050 1,181 201 893 1,050 1,181 2,650 2,700 205 910 1,070 1,204 205 910 1,070 1,204 2,700 2,750 208 927 1,090 1,226 208 927 1,090 1,226 2,750 2,800 212 944 1,110 1,249 212 944 1,110 1,249 2,800 2,850 216 961 1,130 1,271 216 961 1,130 1,271 2,850 2,900 220 978 1,150 1,294 220 978 1,150 1,294 2,900 2,950 224 995 1,170 1,316 224 995 1,170 1,316 2,950 3,000 228 1,012 1,190 1,339 228 1,012 1,190 1,339 3,000 3,050 231 1,029 1,210 1,361 231 1,029 1,210 1,361 3,050 3,100 235 1,046 1,230 1,384 235 1,046 1,230 1,384 3,100 3,150 239 1,063 1,250 1,406 239 1,063 1,250 1,406 3,150 3,200 243 1,080 1,270 1,429 243 1,080 1,270 1,429 3,200 3,250 247 1,097 1,290 1,451 247 1,097 1,290 1,451 3,250 3,300 251 1,114 1,310 1,474 251 1,114 1,310 1,474 3,300 3,350 254 1,131 1,330 1,496 254 1,131 1,330 1,496 3,350 3,400 258 1,148 1,350 1,519 258 1,148 1,350 1,519 3,400 3,450 262 1,165 1,370 1,541 262 1,165 1,370 1,541 3,450 3,500 266 1,182 1,390 1,564 266 1,182 1,390 1,564 3,500 3,550 270 1,199 1,410 1,586 270 1,199 1,410 1,586 3,550 3,600 273 1,216 1,430 1,609 273 1,216 1,430 1,609 3,600 3,650 277 1,233 1,450 1,631 277 1,233 1,450 1,631 3,650 3,700 281 1,250 1,470 1,654 281 1,250 1,470 1,654 3,700 3,750 285 1,267 1,490 1,676 285 1,267 1,490 1,676 3,750 3,800 289 1,284 1,510 1,699 289 1,284 1,510 1,699 3,800 3,850 293 1,301 1,530 1,721 293 1,301 1,530 1,721 3,850 3,900 296 1,318 1,550 1,744 296 1,318 1,550 1,744 3,900 3,950 300 1,335 1,570 1,766 300 1,335 1,570 1,766 3,950 4,000 304 1,352 1,590 1,789 304 1,352 1,590 1,789 4,000 4,050 308 1,369 1,610 1,811 308 1,369 1,610 1,811 4,050 4,100 312 1,386 1,630 1,834 312 1,386 1,630 1,834 4,100 4,150 316 1,403 1,650 1,856 316 1,403 1,650 1,856 4,150 4,200 319 1,420 1,670 1,879 319 1,420 1,670 1,879 4,200 4,250 323 1,437 1,690 1,901 323 1,437 1,690 1,901 4,250 4,300 327 1,454 1,710 1,924 327 1,454 1,710 1,924 4,300 4,350 331 1,471 1,730 1,946 331 1,471 1,730 1,946 4,350 4,400 335 1,488 1,750 1,969 335 1,488 1,750 1,969 4,400 4,450 339 1,505 1,770 1,991 339 1,505 1,770 1,991 4,450 4,500 342 1,522 1,790 2,014 342 1,522 1,790 2,014 4,500 4,550 346 1,539 1,810 2,036 346 1,539 1,810 2,036 4,550 4,600 350 1,556 1,830 2,059 350 1,556 1,830 2,059 4,600 4,650 354 1,573 1,850 2,081 354 1,573 1,850 2,081 4,650 4,700 358 1,590 1,870 2,104 358 1,590 1,870 2,104 4,700 4,750 361 1,607 1,890 2,126 361 1,607 1,890 2,126 4,750 4,800 365 1,624 1,910 2,149 365 1,624 1,910 2,149 4,800 4,850 369 1,641 1,930 2,171 369 1,641 1,930 2,171 4,850 4,900 373 1,658 1,950 2,194 373 1,658 1,950 2,194 4,900 4,950 377 1,675 1,970 2,216 377 1,675 1,970 2,216 4,950 5,000 381 1,692 1,990 2,239 381 1,692 1,990 2,239 5,000 5,050 384 1,709 2,010 2,261 384 1,709 2,010 2,261 5,050 5,100 388 1,726 2,030 2,284 388 1,726 2,030 2,284 5,100 5,150 392 1,743 2,050 2,306 392 1,743 2,050 2,306 5,150 5,200 396 1,760 2,070 2,329 396 1,760 2,070 2,329 5,200 5,250 400 1,777 2,090 2,351 400 1,777 2,090 2,351 5,250 5,300 404 1,794 2,110 2,374 404 1,794 2,110 2,374 5,300 5,350 407 1,811 2,130 2,396 407 1,811 2,130 2,396 5,350 5,400 411 1,828 2,150 2,419 411 1,828 2,150 2,419 5,400 5,450 415 1,845 2,170 2,441 415 1,845 2,170 2,441 5,450 5,500 419 1,862 2,190 2,464 419 1,862 2,190 2,464

(Continued)

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Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is–

5,500 5,550 423 1,879 2,210 2,486 423 1,879 2,210 2,486 5,550 5,600 426 1,896 2,230 2,509 426 1,896 2,230 2,509 5,600 5,650 430 1,913 2,250 2,531 430 1,913 2,250 2,531 5,650 5,700 434 1,930 2,270 2,554 434 1,930 2,270 2,554 5,700 5,750 438 1,947 2,290 2,576 438 1,947 2,290 2,576 5,750 5,800 442 1,964 2,310 2,599 442 1,964 2,310 2,599 5,800 5,850 446 1,981 2,330 2,621 446 1,981 2,330 2,621 5,850 5,900 449 1,998 2,350 2,644 449 1,998 2,350 2,644 5,900 5,950 453 2,015 2,370 2,666 453 2,015 2,370 2,666 5,950 6,000 457 2,032 2,390 2,689 457 2,032 2,390 2,689 6,000 6,050 461 2,049 2,410 2,711 461 2,049 2,410 2,711 6,050 6,100 465 2,066 2,430 2,734 465 2,066 2,430 2,734 6,100 6,150 469 2,083 2,450 2,756 469 2,083 2,450 2,756 6,150 6,200 472 2,100 2,470 2,779 472 2,100 2,470 2,779 6,200 6,250 475 2,117 2,490 2,801 475 2,117 2,490 2,801 6,250 6,300 475 2,134 2,510 2,824 475 2,134 2,510 2,824 6,300 6,350 475 2,151 2,530 2,846 475 2,151 2,530 2,846 6,350 6,400 475 2,168 2,550 2,869 475 2,168 2,550 2,869 6,400 6,450 475 2,185 2,570 2,891 475 2,185 2,570 2,891 6,450 6,500 475 2,202 2,590 2,914 475 2,202 2,590 2,914 6,500 6,550 475 2,219 2,610 2,936 475 2,219 2,610 2,936 6,550 6,600 475 2,236 2,630 2,959 475 2,236 2,630 2,959 6,600 6,650 475 2,253 2,650 2,981 475 2,253 2,650 2,981 6,650 6,700 475 2,270 2,670 3,004 475 2,270 2,670 3,004 6,700 6,750 475 2,287 2,690 3,026 475 2,287 2,690 3,026 6,750 6,800 475 2,304 2,710 3,049 475 2,304 2,710 3,049 6,800 6,850 475 2,321 2,730 3,071 475 2,321 2,730 3,071 6,850 6,900 475 2,338 2,750 3,094 475 2,338 2,750 3,094 6,900 6,950 475 2,355 2,770 3,116 475 2,355 2,770 3,116 6,950 7,000 475 2,372 2,790 3,139 475 2,372 2,790 3,139 7,000 7,050 475 2,389 2,810 3,161 475 2,389 2,810 3,161 7,050 7,100 475 2,406 2,830 3,184 475 2,406 2,830 3,184 7,100 7,150 475 2,423 2,850 3,206 475 2,423 2,850 3,206 7,150 7,200 475 2,440 2,870 3,229 475 2,440 2,870 3,229 7,200 7,250 475 2,457 2,890 3,251 475 2,457 2,890 3,251 7,250 7,300 475 2,474 2,910 3,274 475 2,474 2,910 3,274 7,300 7,350 475 2,491 2,930 3,296 475 2,491 2,930 3,296 7,350 7,400 475 2,508 2,950 3,319 475 2,508 2,950 3,319 7,400 7,450 475 2,525 2,970 3,341 475 2,525 2,970 3,341 7,450 7,500 475 2,542 2,990 3,364 475 2,542 2,990 3,364 7,500 7,550 475 2,559 3,010 3,386 475 2,559 3,010 3,386 7,550 7,600 475 2,576 3,030 3,409 475 2,576 3,030 3,409 7,600 7,650 475 2,593 3,050 3,431 475 2,593 3,050 3,431 7,650 7,700 475 2,610 3,070 3,454 475 2,610 3,070 3,454 7,700 7,750 475 2,627 3,090 3,476 475 2,627 3,090 3,476 7,750 7,800 475 2,644 3,110 3,499 475 2,644 3,110 3,499 7,800 7,850 471 2,661 3,130 3,521 475 2,661 3,130 3,521 7,850 7,900 467 2,678 3,150 3,544 475 2,678 3,150 3,544 7,900 7,950 463 2,695 3,170 3,566 475 2,695 3,170 3,566 7,950 8,000 459 2,712 3,190 3,589 475 2,712 3,190 3,589 8,000 8,050 456 2,729 3,210 3,611 475 2,729 3,210 3,611 8,050 8,100 452 2,746 3,230 3,634 475 2,746 3,230 3,634 8,100 8,150 448 2,763 3,250 3,656 475 2,763 3,250 3,656 8,150 8,200 444 2,780 3,270 3,679 475 2,780 3,270 3,679 8,200 8,250 440 2,797 3,290 3,701 475 2,797 3,290 3,701 8,250 8,300 436 2,814 3,310 3,724 475 2,814 3,310 3,724 8,300 8,350 433 2,831 3,330 3,746 475 2,831 3,330 3,746 8,350 8,400 429 2,848 3,350 3,769 475 2,848 3,350 3,769 8,400 8,450 425 2,865 3,370 3,791 475 2,865 3,370 3,791 8,450 8,500 421 2,882 3,390 3,814 475 2,882 3,390 3,814

(Continued)

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Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is–

8,500 8,550 417 2,899 3,410 3,836 475 2,899 3,410 3,836 8,550 8,600 413 2,916 3,430 3,859 475 2,916 3,430 3,859 8,600 8,650 410 2,933 3,450 3,881 475 2,933 3,450 3,881 8,650 8,700 406 2,950 3,470 3,904 475 2,950 3,470 3,904 8,700 8,750 402 2,967 3,490 3,926 475 2,967 3,490 3,926 8,750 8,800 398 2,984 3,510 3,949 475 2,984 3,510 3,949 8,800 8,850 394 3,001 3,530 3,971 475 3,001 3,530 3,971 8,850 8,900 391 3,018 3,550 3,994 475 3,018 3,550 3,994 8,900 8,950 387 3,035 3,570 4,016 475 3,035 3,570 4,016 8,950 9,000 383 3,052 3,590 4,039 475 3,052 3,590 4,039 9,000 9,050 379 3,069 3,610 4,061 475 3,069 3,610 4,061 9,050 9,100 375 3,086 3,630 4,084 475 3,086 3,630 4,084 9,100 9,150 371 3,103 3,650 4,106 475 3,103 3,650 4,106 9,150 9,200 368 3,120 3,670 4,129 475 3,120 3,670 4,129 9,200 9,250 364 3,137 3,690 4,151 475 3,137 3,690 4,151 9,250 9,300 360 3,154 3,710 4,174 475 3,154 3,710 4,174 9,300 9,350 356 3,169 3,730 4,196 475 3,169 3,730 4,196 9,350 9,400 352 3,169 3,750 4,219 475 3,169 3,750 4,219 9,400 9,450 348 3,169 3,770 4,241 475 3,169 3,770 4,241 9,450 9,500 345 3,169 3,790 4,264 475 3,169 3,790 4,264 9,500 9,550 341 3,169 3,810 4,286 475 3,169 3,810 4,286 9,550 9,600 337 3,169 3,830 4,309 475 3,169 3,830 4,309 9,600 9,650 333 3,169 3,850 4,331 475 3,169 3,850 4,331 9,650 9,700 329 3,169 3,870 4,354 475 3,169 3,870 4,354 9,700 9,750 326 3,169 3,890 4,376 475 3,169 3,890 4,376 9,750 9,800 322 3,169 3,910 4,399 475 3,169 3,910 4,399 9,800 9,850 318 3,169 3,930 4,421 475 3,169 3,930 4,421 9,850 9,900 314 3,169 3,950 4,444 475 3,169 3,950 4,444 9,900 9,950 310 3,169 3,970 4,466 475 3,169 3,970 4,466 9,950 10,000 306 3,169 3,990 4,489 475 3,169 3,990 4,489

10,000 10,050 303 3,169 4,010 4,511 475 3,169 4,010 4,511 10,050 10,100 299 3,169 4,030 4,534 475 3,169 4,030 4,534 10,100 10,150 295 3,169 4,050 4,556 475 3,169 4,050 4,556 10,150 10,200 291 3,169 4,070 4,579 475 3,169 4,070 4,579 10,200 10,250 287 3,169 4,090 4,601 475 3,169 4,090 4,601 10,250 10,300 283 3,169 4,110 4,624 475 3,169 4,110 4,624 10,300 10,350 280 3,169 4,130 4,646 475 3,169 4,130 4,646 10,350 10,400 276 3,169 4,150 4,669 475 3,169 4,150 4,669 10,400 10,450 272 3,169 4,170 4,691 475 3,169 4,170 4,691 10,450 10,500 268 3,169 4,190 4,714 475 3,169 4,190 4,714 10,500 10,550 264 3,169 4,210 4,736 475 3,169 4,210 4,736 10,550 10,600 260 3,169 4,230 4,759 475 3,169 4,230 4,759 10,600 10,650 257 3,169 4,250 4,781 475 3,169 4,250 4,781 10,650 10,700 253 3,169 4,270 4,804 475 3,169 4,270 4,804 10,700 10,750 249 3,169 4,290 4,826 475 3,169 4,290 4,826 10,750 10,800 245 3,169 4,310 4,849 475 3,169 4,310 4,849 10,800 10,850 241 3,169 4,330 4,871 475 3,169 4,330 4,871 10,850 10,900 238 3,169 4,350 4,894 475 3,169 4,350 4,894 10,900 10,950 234 3,169 4,370 4,916 475 3,169 4,370 4,916 10,950 11,000 230 3,169 4,390 4,939 475 3,169 4,390 4,939 11,000 11,050 226 3,169 4,410 4,961 475 3,169 4,410 4,961 11,050 11,100 222 3,169 4,430 4,984 475 3,169 4,430 4,984 11,100 11,150 218 3,169 4,450 5,006 475 3,169 4,450 5,006 11,150 11,200 215 3,169 4,470 5,029 475 3,169 4,470 5,029 11,200 11,250 211 3,169 4,490 5,051 475 3,169 4,490 5,051 11,250 11,300 207 3,169 4,510 5,074 475 3,169 4,510 5,074 11,300 11,350 203 3,169 4,530 5,096 475 3,169 4,530 5,096 11,350 11,400 199 3,169 4,550 5,119 475 3,169 4,550 5,119 11,400 11,450 195 3,169 4,570 5,141 475 3,169 4,570 5,141 11,450 11,500 192 3,169 4,590 5,164 475 3,169 4,590 5,164

(Continued)

-59- Need more information or forms? Visit IRS.gov.

Page 60 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is– 11,500 11,550 188 3,169 4,610 5,186 475 3,169 4,610 5,186 11,550 11,600 184 3,169 4,630 5,209 475 3,169 4,630 5,209 11,600 11,650 180 3,169 4,650 5,231 475 3,169 4,650 5,231 11,650 11,700 176 3,169 4,670 5,254 475 3,169 4,670 5,254 11,700 11,750 173 3,169 4,690 5,276 475 3,169 4,690 5,276 11,750 11,800 169 3,169 4,710 5,299 475 3,169 4,710 5,299 11,800 11,850 165 3,169 4,730 5,321 475 3,169 4,730 5,321 11,850 11,900 161 3,169 4,750 5,344 475 3,169 4,750 5,344 11,900 11,950 157 3,169 4,770 5,366 475 3,169 4,770 5,366 11,950 12,000 153 3,169 4,790 5,389 475 3,169 4,790 5,389 12,000 12,050 150 3,169 4,810 5,411 475 3,169 4,810 5,411 12,050 12,100 146 3,169 4,830 5,434 475 3,169 4,830 5,434 12,100 12,150 142 3,169 4,850 5,456 475 3,169 4,850 5,456 12,150 12,200 138 3,169 4,870 5,479 475 3,169 4,870 5,479 12,200 12,250 134 3,169 4,890 5,501 475 3,169 4,890 5,501 12,250 12,300 130 3,169 4,910 5,524 475 3,169 4,910 5,524 12,300 12,350 127 3,169 4,930 5,546 475 3,169 4,930 5,546 12,350 12,400 123 3,169 4,950 5,569 475 3,169 4,950 5,569 12,400 12,450 119 3,169 4,970 5,591 475 3,169 4,970 5,591 12,450 12,500 115 3,169 4,990 5,614 475 3,169 4,990 5,614 12,500 12,550 111 3,169 5,010 5,636 475 3,169 5,010 5,636 12,550 12,600 107 3,169 5,030 5,659 475 3,169 5,030 5,659 12,600 12,650 104 3,169 5,050 5,681 475 3,169 5,050 5,681 12,650 12,700 100 3,169 5,070 5,704 475 3,169 5,070 5,704 12,700 12,750 96 3,169 5,090 5,726 475 3,169 5,090 5,726 12,750 12,800 92 3,169 5,110 5,749 475 3,169 5,110 5,749 12,800 12,850 88 3,169 5,130 5,771 475 3,169 5,130 5,771 12,850 12,900 85 3,169 5,150 5,794 475 3,169 5,150 5,794 12,900 12,950 81 3,169 5,170 5,816 475 3,169 5,170 5,816 12,950 13,000 77 3,169 5,190 5,839 475 3,169 5,190 5,839 13,000 13,050 73 3,169 5,210 5,861 472 3,169 5,210 5,861 13,050 13,100 69 3,169 5,236 5,891 468 3,169 5,236 5,891 13,100 13,150 65 3,169 5,236 5,891 464 3,169 5,236 5,891 13,150 13,200 62 3,169 5,236 5,891 460 3,169 5,236 5,891 13,200 13,250 58 3,169 5,236 5,891 456 3,169 5,236 5,891 13,250 13,300 54 3,169 5,236 5,891 452 3,169 5,236 5,891 13,300 13,350 50 3,169 5,236 5,891 449 3,169 5,236 5,891 13,350 13,400 46 3,169 5,236 5,891 445 3,169 5,236 5,891 13,400 13,450 42 3,169 5,236 5,891 441 3,169 5,236 5,891 13,450 13,500 39 3,169 5,236 5,891 437 3,169 5,236 5,891 13,500 13,550 35 3,169 5,236 5,891 433 3,169 5,236 5,891 13,550 13,600 31 3,169 5,236 5,891 430 3,169 5,236 5,891 13,600 13,650 27 3,169 5,236 5,891 426 3,169 5,236 5,891 13,650 13,700 23 3,169 5,236 5,891 422 3,169 5,236 5,891 13,700 13,750 20 3,169 5,236 5,891 418 3,169 5,236 5,891 13,750 13,800 16 3,169 5,236 5,891 414 3,169 5,236 5,891 13,800 13,850 12 3,169 5,236 5,891 410 3,169 5,236 5,891 13,850 13,900 8 3,169 5,236 5,891 407 3,169 5,236 5,891 13,900 13,950 4 3,169 5,236 5,891 403 3,169 5,236 5,891 13,950 14,000 * 3,169 5,236 5,891 399 3,169 5,236 5,891 14,000 14,050 0 3,169 5,236 5,891 395 3,169 5,236 5,891 14,050 14,100 0 3,169 5,236 5,891 391 3,169 5,236 5,891 14,100 14,150 0 3,169 5,236 5,891 387 3,169 5,236 5,891 14,150 14,200 0 3,169 5,236 5,891 384 3,169 5,236 5,891 14,200 14,250 0 3,169 5,236 5,891 380 3,169 5,236 5,891 14,250 14,300 0 3,169 5,236 5,891 376 3,169 5,236 5,891 14,300 14,350 0 3,169 5,236 5,891 372 3,169 5,236 5,891 14,350 14,400 0 3,169 5,236 5,891 368 3,169 5,236 5,891 14,400 14,450 0 3,169 5,236 5,891 365 3,169 5,236 5,891 14,450 14,500 0 3,169 5,236 5,891 361 3,169 5,236 5,891

(Continued)

* If the amount you are looking up from the worksheet is at least $13,950 but less than $13,980, and you have no qualifying children, your credit is $1. Otherwise, you cannot take the credit.

Need more information or forms? Visit IRS.gov. -60-

Page 61 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is– 14,500 14,550 0 3,169 5,236 5,891 357 3,169 5,236 5,891 14,550 14,600 0 3,169 5,236 5,891 353 3,169 5,236 5,891 14,600 14,650 0 3,169 5,236 5,891 349 3,169 5,236 5,891 14,650 14,700 0 3,169 5,236 5,891 345 3,169 5,236 5,891 14,700 14,750 0 3,169 5,236 5,891 342 3,169 5,236 5,891 14,750 14,800 0 3,169 5,236 5,891 338 3,169 5,236 5,891 14,800 14,850 0 3,169 5,236 5,891 334 3,169 5,236 5,891 14,850 14,900 0 3,169 5,236 5,891 330 3,169 5,236 5,891 14,900 14,950 0 3,169 5,236 5,891 326 3,169 5,236 5,891 14,950 15,000 0 3,169 5,236 5,891 322 3,169 5,236 5,891 15,000 15,050 0 3,169 5,236 5,891 319 3,169 5,236 5,891 15,050 15,100 0 3,169 5,236 5,891 315 3,169 5,236 5,891 15,100 15,150 0 3,169 5,236 5,891 311 3,169 5,236 5,891 15,150 15,200 0 3,169 5,236 5,891 307 3,169 5,236 5,891 15,200 15,250 0 3,169 5,236 5,891 303 3,169 5,236 5,891 15,250 15,300 0 3,169 5,236 5,891 299 3,169 5,236 5,891 15,300 15,350 0 3,169 5,236 5,891 296 3,169 5,236 5,891 15,350 15,400 0 3,169 5,236 5,891 292 3,169 5,236 5,891 15,400 15,450 0 3,169 5,236 5,891 288 3,169 5,236 5,891 15,450 15,500 0 3,169 5,236 5,891 284 3,169 5,236 5,891 15,500 15,550 0 3,169 5,236 5,891 280 3,169 5,236 5,891 15,550 15,600 0 3,169 5,236 5,891 277 3,169 5,236 5,891 15,600 15,650 0 3,169 5,236 5,891 273 3,169 5,236 5,891 15,650 15,700 0 3,169 5,236 5,891 269 3,169 5,236 5,891 15,700 15,750 0 3,169 5,236 5,891 265 3,169 5,236 5,891 15,750 15,800 0 3,169 5,236 5,891 261 3,169 5,236 5,891 15,800 15,850 0 3,169 5,236 5,891 257 3,169 5,236 5,891 15,850 15,900 0 3,169 5,236 5,891 254 3,169 5,236 5,891 15,900 15,950 0 3,169 5,236 5,891 250 3,169 5,236 5,891 15,950 16,000 0 3,169 5,236 5,891 246 3,169 5,236 5,891 16,000 16,050 0 3,169 5,236 5,891 242 3,169 5,236 5,891 16,050 16,100 0 3,169 5,236 5,891 238 3,169 5,236 5,891 16,100 16,150 0 3,169 5,236 5,891 234 3,169 5,236 5,891 16,150 16,200 0 3,169 5,236 5,891 231 3,169 5,236 5,891 16,200 16,250 0 3,169 5,236 5,891 227 3,169 5,236 5,891 16,250 16,300 0 3,169 5,236 5,891 223 3,169 5,236 5,891 16,300 16,350 0 3,169 5,236 5,891 219 3,169 5,236 5,891 16,350 16,400 0 3,169 5,236 5,891 215 3,169 5,236 5,891 16,400 16,450 0 3,169 5,236 5,891 212 3,169 5,236 5,891 16,450 16,500 0 3,169 5,236 5,891 208 3,169 5,236 5,891 16,500 16,550 0 3,169 5,236 5,891 204 3,169 5,236 5,891 16,550 16,600 0 3,169 5,236 5,891 200 3,169 5,236 5,891 16,600 16,650 0 3,169 5,236 5,891 196 3,169 5,236 5,891 16,650 16,700 0 3,169 5,236 5,891 192 3,169 5,236 5,891 16,700 16,750 0 3,169 5,236 5,891 189 3,169 5,236 5,891 16,750 16,800 0 3,169 5,236 5,891 185 3,169 5,236 5,891 16,800 16,850 0 3,169 5,236 5,891 181 3,169 5,236 5,891 16,850 16,900 0 3,169 5,236 5,891 177 3,169 5,236 5,891 16,900 16,950 0 3,169 5,236 5,891 173 3,169 5,236 5,891 16,950 17,000 0 3,169 5,236 5,891 169 3,169 5,236 5,891 17,000 17,050 0 3,169 5,236 5,891 166 3,169 5,236 5,891 17,050 17,100 0 3,169 5,236 5,891 162 3,169 5,236 5,891 17,100 17,150 0 3,163 5,229 5,883 158 3,169 5,236 5,891 17,150 17,200 0 3,155 5,218 5,873 154 3,169 5,236 5,891 17,200 17,250 0 3,147 5,208 5,862 150 3,169 5,236 5,891 17,250 17,300 0 3,139 5,197 5,852 146 3,169 5,236 5,891 17,300 17,350 0 3,131 5,187 5,841 143 3,169 5,236 5,891 17,350 17,400 0 3,123 5,176 5,830 139 3,169 5,236 5,891 17,400 17,450 0 3,115 5,165 5,820 135 3,169 5,236 5,891 17,450 17,500 0 3,107 5,155 5,809 131 3,169 5,236 5,891

(Continued)

-61- Need more information or forms? Visit IRS.gov.

Page 62 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is– 17,500 17,550 0 3,099 5,144 5,799 127 3,169 5,236 5,891 17,550 17,600 0 3,091 5,134 5,788 124 3,169 5,236 5,891 17,600 17,650 0 3,083 5,123 5,778 120 3,169 5,236 5,891 17,650 17,700 0 3,075 5,113 5,767 116 3,169 5,236 5,891 17,700 17,750 0 3,067 5,102 5,757 112 3,169 5,236 5,891 17,750 17,800 0 3,059 5,092 5,746 108 3,169 5,236 5,891 17,800 17,850 0 3,051 5,081 5,736 104 3,169 5,236 5,891 17,850 17,900 0 3,043 5,071 5,725 101 3,169 5,236 5,891 17,900 17,950 0 3,035 5,060 5,715 97 3,169 5,236 5,891 17,950 18,000 0 3,027 5,050 5,704 93 3,169 5,236 5,891 18,000 18,050 0 3,019 5,039 5,694 89 3,169 5,236 5,891 18,050 18,100 0 3,011 5,029 5,683 85 3,169 5,236 5,891 18,100 18,150 0 3,003 5,018 5,673 81 3,169 5,236 5,891 18,150 18,200 0 2,995 5,007 5,662 78 3,169 5,236 5,891 18,200 18,250 0 2,987 4,997 5,651 74 3,169 5,236 5,891 18,250 18,300 0 2,979 4,986 5,641 70 3,169 5,236 5,891 18,300 18,350 0 2,971 4,976 5,630 66 3,169 5,236 5,891 18,350 18,400 0 2,963 4,965 5,620 62 3,169 5,236 5,891 18,400 18,450 0 2,955 4,955 5,609 59 3,169 5,236 5,891 18,450 18,500 0 2,947 4,944 5,599 55 3,169 5,236 5,891 18,500 18,550 0 2,939 4,934 5,588 51 3,169 5,236 5,891 18,550 18,600 0 2,931 4,923 5,578 47 3,169 5,236 5,891 18,600 18,650 0 2,924 4,913 5,567 43 3,169 5,236 5,891 18,650 18,700 0 2,916 4,902 5,557 39 3,169 5,236 5,891 18,700 18,750 0 2,908 4,892 5,546 36 3,169 5,236 5,891 18,750 18,800 0 2,900 4,881 5,536 32 3,169 5,236 5,891 18,800 18,850 0 2,892 4,871 5,525 28 3,169 5,236 5,891 18,850 18,900 0 2,884 4,860 5,515 24 3,169 5,236 5,891 18,900 18,950 0 2,876 4,850 5,504 20 3,169 5,236 5,891 18,950 19,000 0 2,868 4,839 5,494 16 3,169 5,236 5,891 19,000 19,050 0 2,860 4,828 5,483 13 3,169 5,236 5,891 19,050 19,100 0 2,852 4,818 5,472 9 3,169 5,236 5,891 19,100 19,150 0 2,844 4,807 5,462 5 3,169 5,236 5,891 19,150 19,200 0 2,836 4,797 5,451 * 3,169 5,236 5,891 19,200 19,250 0 2,828 4,786 5,441 0 3,169 5,236 5,891 19,250 19,300 0 2,820 4,776 5,430 0 3,169 5,236 5,891 19,300 19,350 0 2,812 4,765 5,420 0 3,169 5,236 5,891 19,350 19,400 0 2,804 4,755 5,409 0 3,169 5,236 5,891 19,400 19,450 0 2,796 4,744 5,399 0 3,169 5,236 5,891 19,450 19,500 0 2,788 4,734 5,388 0 3,169 5,236 5,891 19,500 19,550 0 2,780 4,723 5,378 0 3,169 5,236 5,891 19,550 19,600 0 2,772 4,713 5,367 0 3,169 5,236 5,891 19,600 19,650 0 2,764 4,702 5,357 0 3,169 5,236 5,891 19,650 19,700 0 2,756 4,692 5,346 0 3,169 5,236 5,891 19,700 19,750 0 2,748 4,681 5,336 0 3,169 5,236 5,891 19,750 19,800 0 2,740 4,671 5,325 0 3,169 5,236 5,891 19,800 19,850 0 2,732 4,660 5,315 0 3,169 5,236 5,891 19,850 19,900 0 2,724 4,649 5,304 0 3,169 5,236 5,891 19,900 19,950 0 2,716 4,639 5,293 0 3,169 5,236 5,891 19,950 20,000 0 2,708 4,628 5,283 0 3,169 5,236 5,891 20,000 20,050 0 2,700 4,618 5,272 0 3,169 5,236 5,891 20,050 20,100 0 2,692 4,607 5,262 0 3,169 5,236 5,891 20,100 20,150 0 2,684 4,597 5,251 0 3,169 5,236 5,891 20,150 20,200 0 2,676 4,586 5,241 0 3,169 5,236 5,891 20,200 20,250 0 2,668 4,576 5,230 0 3,169 5,236 5,891 20,250 20,300 0 2,660 4,565 5,220 0 3,169 5,236 5,891 20,300 20,350 0 2,652 4,555 5,209 0 3,169 5,236 5,891 20,350 20,400 0 2,644 4,544 5,199 0 3,169 5,236 5,891 20,400 20,450 0 2,636 4,534 5,188 0 3,169 5,236 5,891 20,450 20,500 0 2,628 4,523 5,178 0 3,169 5,236 5,891

(Continued)

* If the amount you are looking up from the worksheet is at least $19,150 but less than $19,190, and you have no qualifying children, your credit is $2. Otherwise, you cannot take the credit.

Need more information or forms? Visit IRS.gov. -62-

Page 63 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is– 20,500 20,550 0 2,620 4,513 5,167 0 3,169 5,236 5,891 20,550 20,600 0 2,612 4,502 5,157 0 3,169 5,236 5,891 20,600 20,650 0 2,604 4,492 5,146 0 3,169 5,236 5,891 20,650 20,700 0 2,596 4,481 5,135 0 3,169 5,236 5,891 20,700 20,750 0 2,588 4,470 5,125 0 3,169 5,236 5,891 20,750 20,800 0 2,580 4,460 5,114 0 3,169 5,236 5,891 20,800 20,850 0 2,572 4,449 5,104 0 3,169 5,236 5,891 20,850 20,900 0 2,564 4,439 5,093 0 3,169 5,236 5,891 20,900 20,950 0 2,556 4,428 5,083 0 3,169 5,236 5,891 20,950 21,000 0 2,548 4,418 5,072 0 3,169 5,236 5,891 21,000 21,050 0 2,540 4,407 5,062 0 3,169 5,236 5,891 21,050 21,100 0 2,532 4,397 5,051 0 3,169 5,236 5,891 21,100 21,150 0 2,524 4,386 5,041 0 3,169 5,236 5,891 21,150 21,200 0 2,516 4,376 5,030 0 3,169 5,236 5,891 21,200 21,250 0 2,508 4,365 5,020 0 3,169 5,236 5,891 21,250 21,300 0 2,500 4,355 5,009 0 3,169 5,236 5,891 21,300 21,350 0 2,492 4,344 4,999 0 3,169 5,236 5,891 21,350 21,400 0 2,484 4,334 4,988 0 3,169 5,236 5,891 21,400 21,450 0 2,476 4,323 4,978 0 3,169 5,236 5,891 21,450 21,500 0 2,468 4,313 4,967 0 3,169 5,236 5,891 21,500 21,550 0 2,460 4,302 4,956 0 3,169 5,236 5,891 21,550 21,600 0 2,452 4,291 4,946 0 3,169 5,236 5,891 21,600 21,650 0 2,444 4,281 4,935 0 3,169 5,236 5,891 21,650 21,700 0 2,436 4,270 4,925 0 3,169 5,236 5,891 21,700 21,750 0 2,428 4,260 4,914 0 3,169 5,236 5,891 21,750 21,800 0 2,420 4,249 4,904 0 3,169 5,236 5,891 21,800 21,850 0 2,412 4,239 4,893 0 3,169 5,236 5,891 21,850 21,900 0 2,404 4,228 4,883 0 3,169 5,236 5,891 21,900 21,950 0 2,396 4,218 4,872 0 3,169 5,236 5,891 21,950 22,000 0 2,388 4,207 4,862 0 3,169 5,236 5,891 22,000 22,050 0 2,380 4,197 4,851 0 3,169 5,236 5,891 22,050 22,100 0 2,372 4,186 4,841 0 3,169 5,236 5,891 22,100 22,150 0 2,364 4,176 4,830 0 3,169 5,236 5,891 22,150 22,200 0 2,356 4,165 4,820 0 3,169 5,236 5,891 22,200 22,250 0 2,348 4,155 4,809 0 3,169 5,236 5,891 22,250 22,300 0 2,340 4,144 4,799 0 3,169 5,236 5,891 22,300 22,350 0 2,332 4,134 4,788 0 3,165 5,231 5,885 22,350 22,400 0 2,324 4,123 4,777 0 3,157 5,220 5,875 22,400 22,450 0 2,316 4,112 4,767 0 3,149 5,210 5,864 22,450 22,500 0 2,308 4,102 4,756 0 3,141 5,199 5,854 22,500 22,550 0 2,300 4,091 4,746 0 3,133 5,189 5,843 22,550 22,600 0 2,292 4,081 4,735 0 3,125 5,178 5,833 22,600 22,650 0 2,284 4,070 4,725 0 3,117 5,168 5,822 22,650 22,700 0 2,276 4,060 4,714 0 3,109 5,157 5,812 22,700 22,750 0 2,268 4,049 4,704 0 3,101 5,146 5,801 22,750 22,800 0 2,260 4,039 4,693 0 3,093 5,136 5,790 22,800 22,850 0 2,252 4,028 4,683 0 3,085 5,125 5,780 22,850 22,900 0 2,244 4,018 4,672 0 3,077 5,115 5,769 22,900 22,950 0 2,236 4,007 4,662 0 3,069 5,104 5,759 22,950 23,000 0 2,228 3,997 4,651 0 3,061 5,094 5,748 23,000 23,050 0 2,220 3,986 4,641 0 3,053 5,083 5,738 23,050 23,100 0 2,212 3,976 4,630 0 3,045 5,073 5,727 23,100 23,150 0 2,204 3,965 4,620 0 3,037 5,062 5,717 23,150 23,200 0 2,196 3,954 4,609 0 3,029 5,052 5,706 23,200 23,250 0 2,188 3,944 4,598 0 3,021 5,041 5,696 23,250 23,300 0 2,180 3,933 4,588 0 3,013 5,031 5,685 23,300 23,350 0 2,172 3,923 4,577 0 3,005 5,020 5,675 23,350 23,400 0 2,164 3,912 4,567 0 2,997 5,010 5,664 23,400 23,450 0 2,156 3,902 4,556 0 2,989 4,999 5,654 23,450 23,500 0 2,148 3,891 4,546 0 2,981 4,989 5,643

(Continued)

-63- Need more information or forms? Visit IRS.gov.

Page 64 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is– 23,500 23,550 0 2,140 3,881 4,535 0 2,973 4,978 5,633 23,550 23,600 0 2,132 3,870 4,525 0 2,965 4,967 5,622 23,600 23,650 0 2,125 3,860 4,514 0 2,957 4,957 5,611 23,650 23,700 0 2,117 3,849 4,504 0 2,949 4,946 5,601 23,700 23,750 0 2,109 3,839 4,493 0 2,941 4,936 5,590 23,750 23,800 0 2,101 3,828 4,483 0 2,933 4,925 5,580 23,800 23,850 0 2,093 3,818 4,472 0 2,925 4,915 5,569 23,850 23,900 0 2,085 3,807 4,462 0 2,917 4,904 5,559 23,900 23,950 0 2,077 3,797 4,451 0 2,909 4,894 5,548 23,950 24,000 0 2,069 3,786 4,441 0 2,901 4,883 5,538 24,000 24,050 0 2,061 3,775 4,430 0 2,893 4,873 5,527 24,050 24,100 0 2,053 3,765 4,419 0 2,885 4,862 5,517 24,100 24,150 0 2,045 3,754 4,409 0 2,877 4,852 5,506 24,150 24,200 0 2,037 3,744 4,398 0 2,869 4,841 5,496 24,200 24,250 0 2,029 3,733 4,388 0 2,861 4,831 5,485 24,250 24,300 0 2,021 3,723 4,377 0 2,853 4,820 5,475 24,300 24,350 0 2,013 3,712 4,367 0 2,845 4,810 5,464 24,350 24,400 0 2,005 3,702 4,356 0 2,837 4,799 5,454 24,400 24,450 0 1,997 3,691 4,346 0 2,829 4,788 5,443 24,450 24,500 0 1,989 3,681 4,335 0 2,821 4,778 5,432 24,500 24,550 0 1,981 3,670 4,325 0 2,813 4,767 5,422 24,550 24,600 0 1,973 3,660 4,314 0 2,805 4,757 5,411 24,600 24,650 0 1,965 3,649 4,304 0 2,797 4,746 5,401 24,650 24,700 0 1,957 3,639 4,293 0 2,789 4,736 5,390 24,700 24,750 0 1,949 3,628 4,283 0 2,781 4,725 5,380 24,750 24,800 0 1,941 3,618 4,272 0 2,773 4,715 5,369 24,800 24,850 0 1,933 3,607 4,262 0 2,765 4,704 5,359 24,850 24,900 0 1,925 3,596 4,251 0 2,757 4,694 5,348 24,900 24,950 0 1,917 3,586 4,240 0 2,749 4,683 5,338 24,950 25,000 0 1,909 3,575 4,230 0 2,741 4,673 5,327 25,000 25,050 0 1,901 3,565 4,219 0 2,733 4,662 5,317 25,050 25,100 0 1,893 3,554 4,209 0 2,725 4,652 5,306 25,100 25,150 0 1,885 3,544 4,198 0 2,717 4,641 5,296 25,150 25,200 0 1,877 3,533 4,188 0 2,709 4,631 5,285 25,200 25,250 0 1,869 3,523 4,177 0 2,701 4,620 5,274 25,250 25,300 0 1,861 3,512 4,167 0 2,693 4,609 5,264 25,300 25,350 0 1,853 3,502 4,156 0 2,685 4,599 5,253 25,350 25,400 0 1,845 3,491 4,146 0 2,677 4,588 5,243 25,400 25,450 0 1,837 3,481 4,135 0 2,669 4,578 5,232 25,450 25,500 0 1,829 3,470 4,125 0 2,661 4,567 5,222 25,500 25,550 0 1,821 3,460 4,114 0 2,653 4,557 5,211 25,550 25,600 0 1,813 3,449 4,104 0 2,645 4,546 5,201 25,600 25,650 0 1,805 3,439 4,093 0 2,637 4,536 5,190 25,650 25,700 0 1,797 3,428 4,082 0 2,629 4,525 5,180 25,700 25,750 0 1,789 3,417 4,072 0 2,621 4,515 5,169 25,750 25,800 0 1,781 3,407 4,061 0 2,613 4,504 5,159 25,800 25,850 0 1,773 3,396 4,051 0 2,606 4,494 5,148 25,850 25,900 0 1,765 3,386 4,040 0 2,598 4,483 5,138 25,900 25,950 0 1,757 3,375 4,030 0 2,590 4,473 5,127 25,950 26,000 0 1,749 3,365 4,019 0 2,582 4,462 5,117 26,000 26,050 0 1,741 3,354 4,009 0 2,574 4,452 5,106 26,050 26,100 0 1,733 3,344 3,998 0 2,566 4,441 5,095 26,100 26,150 0 1,725 3,333 3,988 0 2,558 4,430 5,085 26,150 26,200 0 1,717 3,323 3,977 0 2,550 4,420 5,074 26,200 26,250 0 1,709 3,312 3,967 0 2,542 4,409 5,064 26,250 26,300 0 1,701 3,302 3,956 0 2,534 4,399 5,053 26,300 26,350 0 1,693 3,291 3,946 0 2,526 4,388 5,043 26,350 26,400 0 1,685 3,281 3,935 0 2,518 4,378 5,032 26,400 26,450 0 1,677 3,270 3,925 0 2,510 4,367 5,022 26,450 26,500 0 1,669 3,260 3,914 0 2,502 4,357 5,011

(Continued)

Need more information or forms? Visit IRS.gov. -64-

Page 65 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is– 26,500 26,550 0 1,661 3,249 3,903 0 2,494 4,346 5,001 26,550 26,600 0 1,653 3,238 3,893 0 2,486 4,336 4,990 26,600 26,650 0 1,645 3,228 3,882 0 2,478 4,325 4,980 26,650 26,700 0 1,637 3,217 3,872 0 2,470 4,315 4,969 26,700 26,750 0 1,629 3,207 3,861 0 2,462 4,304 4,959 26,750 26,800 0 1,621 3,196 3,851 0 2,454 4,294 4,948 26,800 26,850 0 1,613 3,186 3,840 0 2,446 4,283 4,938 26,850 26,900 0 1,605 3,175 3,830 0 2,438 4,273 4,927 26,900 26,950 0 1,597 3,165 3,819 0 2,430 4,262 4,916 26,950 27,000 0 1,589 3,154 3,809 0 2,422 4,251 4,906 27,000 27,050 0 1,581 3,144 3,798 0 2,414 4,241 4,895 27,050 27,100 0 1,573 3,133 3,788 0 2,406 4,230 4,885 27,100 27,150 0 1,565 3,123 3,777 0 2,398 4,220 4,874 27,150 27,200 0 1,557 3,112 3,767 0 2,390 4,209 4,864 27,200 27,250 0 1,549 3,102 3,756 0 2,382 4,199 4,853 27,250 27,300 0 1,541 3,091 3,746 0 2,374 4,188 4,843 27,300 27,350 0 1,533 3,081 3,735 0 2,366 4,178 4,832 27,350 27,400 0 1,525 3,070 3,724 0 2,358 4,167 4,822 27,400 27,450 0 1,517 3,059 3,714 0 2,350 4,157 4,811 27,450 27,500 0 1,509 3,049 3,703 0 2,342 4,146 4,801 27,500 27,550 0 1,501 3,038 3,693 0 2,334 4,136 4,790 27,550 27,600 0 1,493 3,028 3,682 0 2,326 4,125 4,780 27,600 27,650 0 1,485 3,017 3,672 0 2,318 4,115 4,769 27,650 27,700 0 1,477 3,007 3,661 0 2,310 4,104 4,759 27,700 27,750 0 1,469 2,996 3,651 0 2,302 4,093 4,748 27,750 27,800 0 1,461 2,986 3,640 0 2,294 4,083 4,737 27,800 27,850 0 1,453 2,975 3,630 0 2,286 4,072 4,727 27,850 27,900 0 1,445 2,965 3,619 0 2,278 4,062 4,716 27,900 27,950 0 1,437 2,954 3,609 0 2,270 4,051 4,706 27,950 28,000 0 1,429 2,944 3,598 0 2,262 4,041 4,695 28,000 28,050 0 1,421 2,933 3,588 0 2,254 4,030 4,685 28,050 28,100 0 1,413 2,923 3,577 0 2,246 4,020 4,674 28,100 28,150 0 1,405 2,912 3,567 0 2,238 4,009 4,664 28,150 28,200 0 1,397 2,901 3,556 0 2,230 3,999 4,653 28,200 28,250 0 1,389 2,891 3,545 0 2,222 3,988 4,643 28,250 28,300 0 1,381 2,880 3,535 0 2,214 3,978 4,632 28,300 28,350 0 1,373 2,870 3,524 0 2,206 3,967 4,622 28,350 28,400 0 1,365 2,859 3,514 0 2,198 3,957 4,611 28,400 28,450 0 1,357 2,849 3,503 0 2,190 3,946 4,601 28,450 28,500 0 1,349 2,838 3,493 0 2,182 3,936 4,590 28,500 28,550 0 1,341 2,828 3,482 0 2,174 3,925 4,580 28,550 28,600 0 1,333 2,817 3,472 0 2,166 3,914 4,569 28,600 28,650 0 1,326 2,807 3,461 0 2,158 3,904 4,558 28,650 28,700 0 1,318 2,796 3,451 0 2,150 3,893 4,548 28,700 28,750 0 1,310 2,786 3,440 0 2,142 3,883 4,537 28,750 28,800 0 1,302 2,775 3,430 0 2,134 3,872 4,527 28,800 28,850 0 1,294 2,765 3,419 0 2,126 3,862 4,516 28,850 28,900 0 1,286 2,754 3,409 0 2,118 3,851 4,506 28,900 28,950 0 1,278 2,744 3,398 0 2,110 3,841 4,495 28,950 29,000 0 1,270 2,733 3,388 0 2,102 3,830 4,485 29,000 29,050 0 1,262 2,722 3,377 0 2,094 3,820 4,474 29,050 29,100 0 1,254 2,712 3,366 0 2,086 3,809 4,464 29,100 29,150 0 1,246 2,701 3,356 0 2,078 3,799 4,453 29,150 29,200 0 1,238 2,691 3,345 0 2,070 3,788 4,443 29,200 29,250 0 1,230 2,680 3,335 0 2,062 3,778 4,432 29,250 29,300 0 1,222 2,670 3,324 0 2,054 3,767 4,422 29,300 29,350 0 1,214 2,659 3,314 0 2,046 3,757 4,411 29,350 29,400 0 1,206 2,649 3,303 0 2,038 3,746 4,401 29,400 29,450 0 1,198 2,638 3,293 0 2,030 3,735 4,390 29,450 29,500 0 1,190 2,628 3,282 0 2,022 3,725 4,379

(Continued)

-65- Need more information or forms? Visit IRS.gov.

Page 66 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is– 29,500 29,550 0 1,182 2,617 3,272 0 2,014 3,714 4,369 29,550 29,600 0 1,174 2,607 3,261 0 2,006 3,704 4,358 29,600 29,650 0 1,166 2,596 3,251 0 1,998 3,693 4,348 29,650 29,700 0 1,158 2,586 3,240 0 1,990 3,683 4,337 29,700 29,750 0 1,150 2,575 3,230 0 1,982 3,672 4,327 29,750 29,800 0 1,142 2,565 3,219 0 1,974 3,662 4,316 29,800 29,850 0 1,134 2,554 3,209 0 1,966 3,651 4,306 29,850 29,900 0 1,126 2,543 3,198 0 1,958 3,641 4,295 29,900 29,950 0 1,118 2,533 3,187 0 1,950 3,630 4,285 29,950 30,000 0 1,110 2,522 3,177 0 1,942 3,620 4,274 30,000 30,050 0 1,102 2,512 3,166 0 1,934 3,609 4,264 30,050 30,100 0 1,094 2,501 3,156 0 1,926 3,599 4,253 30,100 30,150 0 1,086 2,491 3,145 0 1,918 3,588 4,243 30,150 30,200 0 1,078 2,480 3,135 0 1,910 3,578 4,232 30,200 30,250 0 1,070 2,470 3,124 0 1,902 3,567 4,221 30,250 30,300 0 1,062 2,459 3,114 0 1,894 3,556 4,211 30,300 30,350 0 1,054 2,449 3,103 0 1,886 3,546 4,200 30,350 30,400 0 1,046 2,438 3,093 0 1,878 3,535 4,190 30,400 30,450 0 1,038 2,428 3,082 0 1,870 3,525 4,179 30,450 30,500 0 1,030 2,417 3,072 0 1,862 3,514 4,169 30,500 30,550 0 1,022 2,407 3,061 0 1,854 3,504 4,158 30,550 30,600 0 1,014 2,396 3,051 0 1,846 3,493 4,148 30,600 30,650 0 1,006 2,386 3,040 0 1,838 3,483 4,137 30,650 30,700 0 998 2,375 3,029 0 1,830 3,472 4,127 30,700 30,750 0 990 2,364 3,019 0 1,822 3,462 4,116 30,750 30,800 0 982 2,354 3,008 0 1,814 3,451 4,106 30,800 30,850 0 974 2,343 2,998 0 1,807 3,441 4,095 30,850 30,900 0 966 2,333 2,987 0 1,799 3,430 4,085 30,900 30,950 0 958 2,322 2,977 0 1,791 3,420 4,074 30,950 31,000 0 950 2,312 2,966 0 1,783 3,409 4,064 31,000 31,050 0 942 2,301 2,956 0 1,775 3,399 4,053 31,050 31,100 0 934 2,291 2,945 0 1,767 3,388 4,042 31,100 31,150 0 926 2,280 2,935 0 1,759 3,377 4,032 31,150 31,200 0 918 2,270 2,924 0 1,751 3,367 4,021 31,200 31,250 0 910 2,259 2,914 0 1,743 3,356 4,011 31,250 31,300 0 902 2,249 2,903 0 1,735 3,346 4,000 31,300 31,350 0 894 2,238 2,893 0 1,727 3,335 3,990 31,350 31,400 0 886 2,228 2,882 0 1,719 3,325 3,979 31,400 31,450 0 878 2,217 2,872 0 1,711 3,314 3,969 31,450 31,500 0 870 2,207 2,861 0 1,703 3,304 3,958 31,500 31,550 0 862 2,196 2,850 0 1,695 3,293 3,948 31,550 31,600 0 854 2,185 2,840 0 1,687 3,283 3,937 31,600 31,650 0 846 2,175 2,829 0 1,679 3,272 3,927 31,650 31,700 0 838 2,164 2,819 0 1,671 3,262 3,916 31,700 31,750 0 830 2,154 2,808 0 1,663 3,251 3,906 31,750 31,800 0 822 2,143 2,798 0 1,655 3,241 3,895 31,800 31,850 0 814 2,133 2,787 0 1,647 3,230 3,885 31,850 31,900 0 806 2,122 2,777 0 1,639 3,220 3,874 31,900 31,950 0 798 2,112 2,766 0 1,631 3,209 3,863 31,950 32,000 0 790 2,101 2,756 0 1,623 3,198 3,853 32,000 32,050 0 782 2,091 2,745 0 1,615 3,188 3,842 32,050 32,100 0 774 2,080 2,735 0 1,607 3,177 3,832 32,100 32,150 0 766 2,070 2,724 0 1,599 3,167 3,821 32,150 32,200 0 758 2,059 2,714 0 1,591 3,156 3,811 32,200 32,250 0 750 2,049 2,703 0 1,583 3,146 3,800 32,250 32,300 0 742 2,038 2,693 0 1,575 3,135 3,790 32,300 32,350 0 734 2,028 2,682 0 1,567 3,125 3,779 32,350 32,400 0 726 2,017 2,671 0 1,559 3,114 3,769 32,400 32,450 0 718 2,006 2,661 0 1,551 3,104 3,758 32,450 32,500 0 710 1,996 2,650 0 1,543 3,093 3,748

(Continued)

Need more information or forms? Visit IRS.gov. -66-

Page 67 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is– 32,500 32,550 0 702 1,985 2,640 0 1,535 3,083 3,737 32,550 32,600 0 694 1,975 2,629 0 1,527 3,072 3,727 32,600 32,650 0 686 1,964 2,619 0 1,519 3,062 3,716 32,650 32,700 0 678 1,954 2,608 0 1,511 3,051 3,706 32,700 32,750 0 670 1,943 2,598 0 1,503 3,040 3,695 32,750 32,800 0 662 1,933 2,587 0 1,495 3,030 3,684 32,800 32,850 0 654 1,922 2,577 0 1,487 3,019 3,674 32,850 32,900 0 646 1,912 2,566 0 1,479 3,009 3,663 32,900 32,950 0 638 1,901 2,556 0 1,471 2,998 3,653 32,950 33,000 0 630 1,891 2,545 0 1,463 2,988 3,642 33,000 33,050 0 622 1,880 2,535 0 1,455 2,977 3,632 33,050 33,100 0 614 1,870 2,524 0 1,447 2,967 3,621 33,100 33,150 0 606 1,859 2,514 0 1,439 2,956 3,611 33,150 33,200 0 598 1,848 2,503 0 1,431 2,946 3,600 33,200 33,250 0 590 1,838 2,492 0 1,423 2,935 3,590 33,250 33,300 0 582 1,827 2,482 0 1,415 2,925 3,579 33,300 33,350 0 574 1,817 2,471 0 1,407 2,914 3,569 33,350 33,400 0 566 1,806 2,461 0 1,399 2,904 3,558 33,400 33,450 0 558 1,796 2,450 0 1,391 2,893 3,548 33,450 33,500 0 550 1,785 2,440 0 1,383 2,883 3,537 33,500 33,550 0 542 1,775 2,429 0 1,375 2,872 3,527 33,550 33,600 0 534 1,764 2,419 0 1,367 2,861 3,516 33,600 33,650 0 527 1,754 2,408 0 1,359 2,851 3,505 33,650 33,700 0 519 1,743 2,398 0 1,351 2,840 3,495 33,700 33,750 0 511 1,733 2,387 0 1,343 2,830 3,484 33,750 33,800 0 503 1,722 2,377 0 1,335 2,819 3,474 33,800 33,850 0 495 1,712 2,366 0 1,327 2,809 3,463 33,850 33,900 0 487 1,701 2,356 0 1,319 2,798 3,453 33,900 33,950 0 479 1,691 2,345 0 1,311 2,788 3,442 33,950 34,000 0 471 1,680 2,335 0 1,303 2,777 3,432 34,000 34,050 0 463 1,669 2,324 0 1,295 2,767 3,421 34,050 34,100 0 455 1,659 2,313 0 1,287 2,756 3,411 34,100 34,150 0 447 1,648 2,303 0 1,279 2,746 3,400 34,150 34,200 0 439 1,638 2,292 0 1,271 2,735 3,390 34,200 34,250 0 431 1,627 2,282 0 1,263 2,725 3,379 34,250 34,300 0 423 1,617 2,271 0 1,255 2,714 3,369 34,300 34,350 0 415 1,606 2,261 0 1,247 2,704 3,358 34,350 34,400 0 407 1,596 2,250 0 1,239 2,693 3,348 34,400 34,450 0 399 1,585 2,240 0 1,231 2,682 3,337 34,450 34,500 0 391 1,575 2,229 0 1,223 2,672 3,326 34,500 34,550 0 383 1,564 2,219 0 1,215 2,661 3,316 34,550 34,600 0 375 1,554 2,208 0 1,207 2,651 3,305 34,600 34,650 0 367 1,543 2,198 0 1,199 2,640 3,295 34,650 34,700 0 359 1,533 2,187 0 1,191 2,630 3,284 34,700 34,750 0 351 1,522 2,177 0 1,183 2,619 3,274 34,750 34,800 0 343 1,512 2,166 0 1,175 2,609 3,263 34,800 34,850 0 335 1,501 2,156 0 1,167 2,598 3,253 34,850 34,900 0 327 1,490 2,145 0 1,159 2,588 3,242 34,900 34,950 0 319 1,480 2,134 0 1,151 2,577 3,232 34,950 35,000 0 311 1,469 2,124 0 1,143 2,567 3,221 35,000 35,050 0 303 1,459 2,113 0 1,135 2,556 3,211 35,050 35,100 0 295 1,448 2,103 0 1,127 2,546 3,200 35,100 35,150 0 287 1,438 2,092 0 1,119 2,535 3,190 35,150 35,200 0 279 1,427 2,082 0 1,111 2,525 3,179 35,200 35,250 0 271 1,417 2,071 0 1,103 2,514 3,168 35,250 35,300 0 263 1,406 2,061 0 1,095 2,503 3,158 35,300 35,350 0 255 1,396 2,050 0 1,087 2,493 3,147 35,350 35,400 0 247 1,385 2,040 0 1,079 2,482 3,137 35,400 35,450 0 239 1,375 2,029 0 1,071 2,472 3,126 35,450 35,500 0 231 1,364 2,019 0 1,063 2,461 3,116

(Continued)

-67- Need more information or forms? Visit IRS.gov.

Page 68 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is– 35,500 35,550 0 223 1,354 2,008 0 1,055 2,451 3,105 35,550 35,600 0 215 1,343 1,998 0 1,047 2,440 3,095 35,600 35,650 0 207 1,333 1,987 0 1,039 2,430 3,084 35,650 35,700 0 199 1,322 1,976 0 1,031 2,419 3,074 35,700 35,750 0 191 1,311 1,966 0 1,023 2,409 3,063 35,750 35,800 0 183 1,301 1,955 0 1,015 2,398 3,053 35,800 35,850 0 175 1,290 1,945 0 1,008 2,388 3,042 35,850 35,900 0 167 1,280 1,934 0 1,000 2,377 3,032 35,900 35,950 0 159 1,269 1,924 0 992 2,367 3,021 35,950 36,000 0 151 1,259 1,913 0 984 2,356 3,011 36,000 36,050 0 143 1,248 1,903 0 976 2,346 3,000 36,050 36,100 0 135 1,238 1,892 0 968 2,335 2,989 36,100 36,150 0 127 1,227 1,882 0 960 2,324 2,979 36,150 36,200 0 119 1,217 1,871 0 952 2,314 2,968 36,200 36,250 0 111 1,206 1,861 0 944 2,303 2,958 36,250 36,300 0 103 1,196 1,850 0 936 2,293 2,947 36,300 36,350 0 95 1,185 1,840 0 928 2,282 2,937 36,350 36,400 0 87 1,175 1,829 0 920 2,272 2,926 36,400 36,450 0 79 1,164 1,819 0 912 2,261 2,916 36,450 36,500 0 71 1,154 1,808 0 904 2,251 2,905 36,500 36,550 0 63 1,143 1,797 0 896 2,240 2,895 36,550 36,600 0 55 1,132 1,787 0 888 2,230 2,884 36,600 36,650 0 47 1,122 1,776 0 880 2,219 2,874 36,650 36,700 0 39 1,111 1,766 0 872 2,209 2,863 36,700 36,750 0 31 1,101 1,755 0 864 2,198 2,853 36,750 36,800 0 23 1,090 1,745 0 856 2,188 2,842 36,800 36,850 0 15 1,080 1,734 0 848 2,177 2,832 36,850 36,900 0 7 1,069 1,724 0 840 2,167 2,821 36,900 36,950 0 * 1,059 1,713 0 832 2,156 2,810 36,950 37,000 0 0 1,048 1,703 0 824 2,145 2,800 37,000 37,050 0 0 1,038 1,692 0 816 2,135 2,789 37,050 37,100 0 0 1,027 1,682 0 808 2,124 2,779 37,100 37,150 0 0 1,017 1,671 0 800 2,114 2,768 37,150 37,200 0 0 1,006 1,661 0 792 2,103 2,758 37,200 37,250 0 0 996 1,650 0 784 2,093 2,747 37,250 37,300 0 0 985 1,640 0 776 2,082 2,737 37,300 37,350 0 0 975 1,629 0 768 2,072 2,726 37,350 37,400 0 0 964 1,618 0 760 2,061 2,716 37,400 37,450 0 0 953 1,608 0 752 2,051 2,705 37,450 37,500 0 0 943 1,597 0 744 2,040 2,695 37,500 37,550 0 0 932 1,587 0 736 2,030 2,684 37,550 37,600 0 0 922 1,576 0 728 2,019 2,674 37,600 37,650 0 0 911 1,566 0 720 2,009 2,663 37,650 37,700 0 0 901 1,555 0 712 1,998 2,653 37,700 37,750 0 0 890 1,545 0 704 1,987 2,642 37,750 37,800 0 0 880 1,534 0 696 1,977 2,631 37,800 37,850 0 0 869 1,524 0 688 1,966 2,621 37,850 37,900 0 0 859 1,513 0 680 1,956 2,610 37,900 37,950 0 0 848 1,503 0 672 1,945 2,600 37,950 38,000 0 0 838 1,492 0 664 1,935 2,589 38,000 38,050 0 0 827 1,482 0 656 1,924 2,579 38,050 38,100 0 0 817 1,471 0 648 1,914 2,568 38,100 38,150 0 0 806 1,461 0 640 1,903 2,558 38,150 38,200 0 0 795 1,450 0 632 1,893 2,547 38,200 38,250 0 0 785 1,439 0 624 1,882 2,537 38,250 38,300 0 0 774 1,429 0 616 1,872 2,526 38,300 38,350 0 0 764 1,418 0 608 1,861 2,516 38,350 38,400 0 0 753 1,408 0 600 1,851 2,505 38,400 38,450 0 0 743 1,397 0 592 1,840 2,495 38,450 38,500 0 0 732 1,387 0 584 1,830 2,484

(Continued)

* If the amount you are looking up from the worksheet is at least $36,900 but less than $36,920, and you have one qualifying child, your credit is $2. Otherwise, you cannot take the credit.

Need more information or forms? Visit IRS.gov. -68-

Page 69 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is– 38,500 38,550 0 0 722 1,376 0 576 1,819 2,474 38,550 38,600 0 0 711 1,366 0 568 1,808 2,463 38,600 38,650 0 0 701 1,355 0 560 1,798 2,452 38,650 38,700 0 0 690 1,345 0 552 1,787 2,442 38,700 38,750 0 0 680 1,334 0 544 1,777 2,431 38,750 38,800 0 0 669 1,324 0 536 1,766 2,421 38,800 38,850 0 0 659 1,313 0 528 1,756 2,410 38,850 38,900 0 0 648 1,303 0 520 1,745 2,400 38,900 38,950 0 0 638 1,292 0 512 1,735 2,389 38,950 39,000 0 0 627 1,282 0 504 1,724 2,379 39,000 39,050 0 0 616 1,271 0 496 1,714 2,368 39,050 39,100 0 0 606 1,260 0 488 1,703 2,358 39,100 39,150 0 0 595 1,250 0 480 1,693 2,347 39,150 39,200 0 0 585 1,239 0 472 1,682 2,337 39,200 39,250 0 0 574 1,229 0 464 1,672 2,326 39,250 39,300 0 0 564 1,218 0 456 1,661 2,316 39,300 39,350 0 0 553 1,208 0 448 1,651 2,305 39,350 39,400 0 0 543 1,197 0 440 1,640 2,295 39,400 39,450 0 0 532 1,187 0 432 1,629 2,284 39,450 39,500 0 0 522 1,176 0 424 1,619 2,273 39,500 39,550 0 0 511 1,166 0 416 1,608 2,263 39,550 39,600 0 0 501 1,155 0 408 1,598 2,252 39,600 39,650 0 0 490 1,145 0 400 1,587 2,242 39,650 39,700 0 0 480 1,134 0 392 1,577 2,231 39,700 39,750 0 0 469 1,124 0 384 1,566 2,221 39,750 39,800 0 0 459 1,113 0 376 1,556 2,210 39,800 39,850 0 0 448 1,103 0 368 1,545 2,200 39,850 39,900 0 0 437 1,092 0 360 1,535 2,189 39,900 39,950 0 0 427 1,081 0 352 1,524 2,179 39,950 40,000 0 0 416 1,071 0 344 1,514 2,168 40,000 40,050 0 0 406 1,060 0 336 1,503 2,158 40,050 40,100 0 0 395 1,050 0 328 1,493 2,147 40,100 40,150 0 0 385 1,039 0 320 1,482 2,137 40,150 40,200 0 0 374 1,029 0 312 1,472 2,126 40,200 40,250 0 0 364 1,018 0 304 1,461 2,115 40,250 40,300 0 0 353 1,008 0 296 1,450 2,105 40,300 40,350 0 0 343 997 0 288 1,440 2,094 40,350 40,400 0 0 332 987 0 280 1,429 2,084 40,400 40,450 0 0 322 976 0 272 1,419 2,073 40,450 40,500 0 0 311 966 0 264 1,408 2,063 40,500 40,550 0 0 301 955 0 256 1,398 2,052 40,550 40,600 0 0 290 945 0 248 1,387 2,042 40,600 40,650 0 0 280 934 0 240 1,377 2,031 40,650 40,700 0 0 269 923 0 232 1,366 2,021 40,700 40,750 0 0 258 913 0 224 1,356 2,010 40,750 40,800 0 0 248 902 0 216 1,345 2,000 40,800 40,850 0 0 237 892 0 209 1,335 1,989 40,850 40,900 0 0 227 881 0 201 1,324 1,979 40,900 40,950 0 0 216 871 0 193 1,314 1,968 40,950 41,000 0 0 206 860 0 185 1,303 1,958 41,000 41,050 0 0 195 850 0 177 1,293 1,947 41,050 41,100 0 0 185 839 0 169 1,282 1,936 41,100 41,150 0 0 174 829 0 161 1,271 1,926 41,150 41,200 0 0 164 818 0 153 1,261 1,915 41,200 41,250 0 0 153 808 0 145 1,250 1,905 41,250 41,300 0 0 143 797 0 137 1,240 1,894 41,300 41,350 0 0 132 787 0 129 1,229 1,884 41,350 41,400 0 0 122 776 0 121 1,219 1,873 41,400 41,450 0 0 111 766 0 113 1,208 1,863 41,450 41,500 0 0 101 755 0 105 1,198 1,852

(Continued)

-69- Need more information or forms? Visit IRS.gov.

Page 70 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is– 41,500 41,550 0 0 90 744 0 97 1,187 1,842 41,550 41,600 0 0 79 734 0 89 1,177 1,831 41,600 41,650 0 0 69 723 0 81 1,166 1,821 41,650 41,700 0 0 58 713 0 73 1,156 1,810 41,700 41,750 0 0 48 702 0 65 1,145 1,800 41,750 41,800 0 0 37 692 0 57 1,135 1,789 41,800 41,850 0 0 27 681 0 49 1,124 1,779 41,850 41,900 0 0 16 671 0 41 1,114 1,768 41,900 41,950 0 0 6 660 0 33 1,103 1,757 41,950 42,000 0 0 0 650 0 25 1,092 1,747 42,000 42,050 0 0 0 639 0 17 1,082 1,736 42,050 42,100 0 0 0 629 0 9 1,071 1,726 42,100 42,150 0 0 0 618 0 * 1,061 1,715 42,150 42,200 0 0 0 608 0 0 1,050 1,705 42,200 42,250 0 0 0 597 0 0 1,040 1,694 42,250 42,300 0 0 0 587 0 0 1,029 1,684 42,300 42,350 0 0 0 576 0 0 1,019 1,673 42,350 42,400 0 0 0 565 0 0 1,008 1,663 42,400 42,450 0 0 0 555 0 0 998 1,652 42,450 42,500 0 0 0 544 0 0 987 1,642 42,500 42,550 0 0 0 534 0 0 977 1,631 42,550 42,600 0 0 0 523 0 0 966 1,621 42,600 42,650 0 0 0 513 0 0 956 1,610 42,650 42,700 0 0 0 502 0 0 945 1,600 42,700 42,750 0 0 0 492 0 0 934 1,589 42,750 42,800 0 0 0 481 0 0 924 1,578 42,800 42,850 0 0 0 471 0 0 913 1,568 42,850 42,900 0 0 0 460 0 0 903 1,557 42,900 42,950 0 0 0 450 0 0 892 1,547 42,950 43,000 0 0 0 439 0 0 882 1,536 43,000 43,050 0 0 0 429 0 0 871 1,526 43,050 43,100 0 0 0 418 0 0 861 1,515 43,100 43,150 0 0 0 408 0 0 850 1,505 43,150 43,200 0 0 0 397 0 0 840 1,494 43,200 43,250 0 0 0 386 0 0 829 1,484 43,250 43,300 0 0 0 376 0 0 819 1,473 43,300 43,350 0 0 0 365 0 0 808 1,463 43,350 43,400 0 0 0 355 0 0 798 1,452 43,400 43,450 0 0 0 344 0 0 787 1,442 43,450 43,500 0 0 0 334 0 0 777 1,431 43,500 43,550 0 0 0 323 0 0 766 1,421 43,550 43,600 0 0 0 313 0 0 755 1,410 43,600 43,650 0 0 0 302 0 0 745 1,399 43,650 43,700 0 0 0 292 0 0 734 1,389 43,700 43,750 0 0 0 281 0 0 724 1,378 43,750 43,800 0 0 0 271 0 0 713 1,368 43,800 43,850 0 0 0 260 0 0 703 1,357 43,850 43,900 0 0 0 250 0 0 692 1,347 43,900 43,950 0 0 0 239 0 0 682 1,336 43,950 44,000 0 0 0 229 0 0 671 1,326 44,000 44,050 0 0 0 218 0 0 661 1,315 44,050 44,100 0 0 0 207 0 0 650 1,305 44,100 44,150 0 0 0 197 0 0 640 1,294 44,150 44,200 0 0 0 186 0 0 629 1,284 44,200 44,250 0 0 0 176 0 0 619 1,273 44,250 44,300 0 0 0 165 0 0 608 1,263 44,300 44,350 0 0 0 155 0 0 598 1,252 44,350 44,400 0 0 0 144 0 0 587 1,242 44,400 44,450 0 0 0 134 0 0 576 1,231 44,450 44,500 0 0 0 123 0 0 566 1,220

(Continued)

* If the amount you are looking up from the worksheet is at least $42,100 but less than $42,130, and you have one qualifying child, your credit is $2. Otherwise, you cannot take the credit.

Need more information or forms? Visit IRS.gov. -70-

Page 71 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is– 44,500 44,550 0 0 0 113 0 0 555 1,210 44,550 44,600 0 0 0 102 0 0 545 1,199 44,600 44,650 0 0 0 92 0 0 534 1,189 44,650 44,700 0 0 0 81 0 0 524 1,178 44,700 44,750 0 0 0 71 0 0 513 1,168 44,750 44,800 0 0 0 60 0 0 503 1,157 44,800 44,850 0 0 0 50 0 0 492 1,147 44,850 44,900 0 0 0 39 0 0 482 1,136 44,900 44,950 0 0 0 28 0 0 471 1,126 44,950 45,000 0 0 0 18 0 0 461 1,115 45,000 45,050 0 0 0 7 0 0 450 1,105 45,050 45,100 0 0 0 * 0 0 440 1,094 45,100 45,150 0 0 0 0 0 0 429 1,084 45,150 45,200 0 0 0 0 0 0 419 1,073 45,200 45,250 0 0 0 0 0 0 408 1,062 45,250 45,300 0 0 0 0 0 0 397 1,052 45,300 45,350 0 0 0 0 0 0 387 1,041 45,350 45,400 0 0 0 0 0 0 376 1,031 45,400 45,450 0 0 0 0 0 0 366 1,020 45,450 45,500 0 0 0 0 0 0 355 1,010 45,500 45,550 0 0 0 0 0 0 345 999 45,550 45,600 0 0 0 0 0 0 334 989 45,600 45,650 0 0 0 0 0 0 324 978 45,650 45,700 0 0 0 0 0 0 313 968 45,700 45,750 0 0 0 0 0 0 303 957 45,750 45,800 0 0 0 0 0 0 292 947 45,800 45,850 0 0 0 0 0 0 282 936 45,850 45,900 0 0 0 0 0 0 271 926 45,900 45,950 0 0 0 0 0 0 261 915 45,950 46,000 0 0 0 0 0 0 250 905 46,000 46,050 0 0 0 0 0 0 240 894 46,050 46,100 0 0 0 0 0 0 229 883 46,100 46,150 0 0 0 0 0 0 218 873 46,150 46,200 0 0 0 0 0 0 208 862 46,200 46,250 0 0 0 0 0 0 197 852 46,250 46,300 0 0 0 0 0 0 187 841 46,300 46,350 0 0 0 0 0 0 176 831 46,350 46,400 0 0 0 0 0 0 166 820 46,400 46,450 0 0 0 0 0 0 155 810 46,450 46,500 0 0 0 0 0 0 145 799 46,500 46,550 0 0 0 0 0 0 134 789 46,550 46,600 0 0 0 0 0 0 124 778 46,600 46,650 0 0 0 0 0 0 113 768 46,650 46,700 0 0 0 0 0 0 103 757 46,700 46,750 0 0 0 0 0 0 92 747 46,750 46,800 0 0 0 0 0 0 82 736 46,800 46,850 0 0 0 0 0 0 71 726 46,850 46,900 0 0 0 0 0 0 61 715 46,900 46,950 0 0 0 0 0 0 50 704 46,950 47,000 0 0 0 0 0 0 39 694 47,000 47,050 0 0 0 0 0 0 29 683 47,050 47,100 0 0 0 0 0 0 18 673 47,100 47,150 0 0 0 0 0 0 8 662 47,150 47,200 0 0 0 0 0 0 ** 652 47,200 47,250 0 0 0 0 0 0 0 641 47,250 47,300 0 0 0 0 0 0 0 631 47,300 47,350 0 0 0 0 0 0 0 620 47,350 47,400 0 0 0 0 0 0 0 610 47,400 47,450 0 0 0 0 0 0 0 599 47,450 47,500 0 0 0 0 0 0 0 589

(Continued)

* If the amount you are looking up from the worksheet is at least $45,050 but less than $45,060, and you have three qualifying children, your credit is $1. Otherwise, you cannot take the credit. ** If the amount you are looking up from the worksheet is at least $47,150 but less than $47,162, and you have two qualifying children, your credit is $1. Otherwise, you cannot take the credit.

-71- Need more information or forms? Visit IRS.gov.

Page 72 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

Earned Income Credit (EIC) Table - Continued (Caution. This is not a tax table.). And your filing status is–

If the amount you are looking up from the worksheet is–

Single, head of household, or qualifying widow(er) and you have–

Married filing jointly and you have–

No Children One Child Two Children Three Children No Children One Child Two Children Three Children At least But less than Your credit is– Your credit is– 47,500 47,550 0 0 0 0 0 0 0 578 47,550 47,600 0 0 0 0 0 0 0 568 47,600 47,650 0 0 0 0 0 0 0 557 47,650 47,700 0 0 0 0 0 0 0 547 47,700 47,750 0 0 0 0 0 0 0 536 47,750 47,800 0 0 0 0 0 0 0 525 47,800 47,850 0 0 0 0 0 0 0 515 47,850 47,900 0 0 0 0 0 0 0 504 47,900 47,950 0 0 0 0 0 0 0 494 47,950 48,000 0 0 0 0 0 0 0 483 48,000 48,050 0 0 0 0 0 0 0 473 48,050 48,100 0 0 0 0 0 0 0 462 48,100 48,150 0 0 0 0 0 0 0 452 48,150 48,200 0 0 0 0 0 0 0 441 48,200 48,250 0 0 0 0 0 0 0 431 48,250 48,300 0 0 0 0 0 0 0 420 48,300 48,350 0 0 0 0 0 0 0 410 48,350 48,400 0 0 0 0 0 0 0 399 48,400 48,450 0 0 0 0 0 0 0 389 48,450 48,500 0 0 0 0 0 0 0 378 48,500 48,550 0 0 0 0 0 0 0 368 48,550 48,600 0 0 0 0 0 0 0 357 48,600 48,650 0 0 0 0 0 0 0 346 48,650 48,700 0 0 0 0 0 0 0 336 48,700 48,750 0 0 0 0 0 0 0 325 48,750 48,800 0 0 0 0 0 0 0 315 48,800 48,850 0 0 0 0 0 0 0 304 48,850 48,900 0 0 0 0 0 0 0 294 48,900 48,950 0 0 0 0 0 0 0 283 48,950 49,000 0 0 0 0 0 0 0 273 49,000 49,050 0 0 0 0 0 0 0 262 49,050 49,100 0 0 0 0 0 0 0 252 49,100 49,150 0 0 0 0 0 0 0 241 49,150 49,200 0 0 0 0 0 0 0 231 49,200 49,250 0 0 0 0 0 0 0 220 49,250 49,300 0 0 0 0 0 0 0 210 49,300 49,350 0 0 0 0 0 0 0 199 49,350 49,400 0 0 0 0 0 0 0 189 49,400 49,450 0 0 0 0 0 0 0 178 49,450 49,500 0 0 0 0 0 0 0 167 49,500 49,550 0 0 0 0 0 0 0 157 49,550 49,600 0 0 0 0 0 0 0 146 49,600 49,650 0 0 0 0 0 0 0 136 49,650 49,700 0 0 0 0 0 0 0 125 49,700 49,750 0 0 0 0 0 0 0 115 49,750 49,800 0 0 0 0 0 0 0 104 49,800 49,850 0 0 0 0 0 0 0 94 49,850 49,900 0 0 0 0 0 0 0 83 49,900 49,950 0 0 0 0 0 0 0 73 49,950 50,000 0 0 0 0 0 0 0 62 50,000 50,050 0 0 0 0 0 0 0 52 50,050 50,100 0 0 0 0 0 0 0 41 50,100 50,150 0 0 0 0 0 0 0 31 50,150 50,200 0 0 0 0 0 0 0 20 50,200 50,250 0 0 0 0 0 0 0 9 50,250 50,270 0 0 0 0 0 0 0 2

Need more information or forms? Visit IRS.gov. -72-

Page 73 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

2012 Form 1040—Lines 65 Through 73

Line 65 Additional Child Tax Credit What Is the Additional Child Tax Credit? This credit is for certain people who have at least one qualifying child as de- fined in the instructions for line 6c. The additional child tax credit may give you a refund even if you do not owe any tax.

Two Steps To Take the Additional Child Tax Credit! Step 1. Be sure you figured the amount, if any, of your child tax credit. See the instructions for line 51. Step 2. Read the TIP at the end of your Child Tax Credit Worksheet. Use Schedule 8812 to see if you can take the additional child tax credit, but only if you meet the condition given in that TIP.

Line 66 American Opportunity Credit If you meet the requirements to claim an education credit (see the instructions for line 49), enter on line 66 the amount, if any, from Form 8863, line 8.

Line 67 Reserved This line has been reserved for future use.

Line 68 Amount Paid With Request for Extension To File If you got an automatic extension of time to file Form 1040 by filing Form 4868 or by making a payment, enter the amount of the payment or any amount you paid with Form 4868. If you paid by credit or debit card, do not include on line 68 the convenience fee you were charged. Also, include any amounts paid with Form 2350.

You may be able to deduct any credit or debit card conven- ience fees on your 2013 Sched-

ule A.

Line 69 Excess Social Security and Tier 1 RRTA Tax Withheld If you, or your spouse if filing a joint re- turn, had more than one employer for 2012 and total wages of more than $110,100, too much social security or tier 1 railroad retirement (RRTA) tax may have been withheld. You can take a credit on this line for the amount with- held in excess of $4,624.20. But if any one employer withheld more than $4,624.20, you cannot claim the excess on your return. The employer should ad- just the tax for you. If the employer does not adjust the overcollection, you can file a claim for refund using Form 843. Figure this amount separately for you and your spouse.

You cannot claim a refund for excess tier 2 RRTA tax on Form 1040. Instead, use Form 843.

For more details, see Pub. 505.

Line 70 Credit for Federal Tax on Fuels Enter any credit for federal excise taxes paid on fuels that are ultimately used for a nontaxable purpose (for example, an off-highway business use). Attach Form 4136.

Line 71 Check the box(es) on line 71 to report any credit from Form 2439, 8801 (line 27), or 8885. If you claim more than one of these credits, enter the total on line 71.

If you are claiming a credit for repay- ment of amounts you included in your income in an earlier year because it ap- peared you had a right to the income, in- clude the credit on line 71 and enter “I.R.C. 1341” to the right of line 71. See Pub. 525 for details about this credit.

TIP The adoption credit previously claimed on line 71, box b, is no longer refundable. It now must

be claimed on line 53. Line 71, box b, is now shown as “Reserved” for future use.

Refund Line 73 Amount Overpaid If line 73 is under $1, we will send a re- fund only on written request.

If the amount you overpaid is large, you may want to de- crease the amount of income

tax withheld from your pay by filing a new Form W-4. See Income Tax With- holding and Estimated Tax Payments for 2013 under General Information, later.

Refund Offset If you owe past-due federal tax, state in- come tax, state unemployment compen- sation debts, child support, spousal sup- port, or certain federal nontax debts, such as student loans, all or part of the overpayment on line 73 may be used (offset) to pay the past-due amount. Off- sets for federal taxes are made by the IRS. All other offsets are made by the Treasury Department's Financial Man- agement Service (FMS). For federal tax offsets, you will receive a notice from the IRS. For all other offsets, you will receive a notice from FMS. To find out if you may have an offset or if you have any questions about it, contact the agen- cy to which you owe the debt.

Injured Spouse If you file a joint return and your spouse has not paid past-due federal tax, state income tax, state unemployment com- pensation debts, child support, spousal support, or a federal nontax debt, such as a student loan, part or all of the over- payment on line 73 may be used (offset) to pay the past-due amount. But your part of the overpayment may be refun- ded to you if certain conditions apply and you complete Form 8379. For de- tails, use TeleTax topic 203 or see Form 8379.

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2012 Form 1040—Lines 74a Through 74d

Lines 74a Through 74d Amount Refunded to You If you want to check the status of your refund, see Refund Information, later. Just use the IRS2Go phone app or go to IRS.gov and click on Where's My Re- fund. Information about your return will generally be available within 24 hours after the IRS receives your e-filed re- turn, or 4 weeks after you mail your pa- per return. If you filed Form 8379 with your return, wait 14 weeks (11 weeks if you filed electronically). Have your 2012 tax return handy so you can pro- vide your social security number, your filing status, and the exact whole dollar amount of your refund.

Where's My Refund? has a new look this year! The tool will include a tracker that displays progress through three stages: (1) return received, (2) refund approved, and (3) refund sent. Where's My Refund? will provide an actual per- sonalized refund date as soon as the IRS processes your tax return and approves your refund. So in a change from previ- ous filing seasons, you won't get an esti- mated refund date right away. Effect of refund on benefits. Any re- fund you receive cannot be counted as income when determining if you or any- one else is eligible for benefits or assis- tance, or how much you or anyone else can receive, under any federal program or under any state or local program fi- nanced in whole or in part with federal funds. These programs include Tempo- rary Assistance for Needy Families (TANF), Medicaid, Supplemental Se- curity Income (SSI), and Supplemental Nutrition Assistance Program (food stamps). In addition, when determining eligibility, the refund cannot be counted as a resource for at least 12 months after you receive it. Check with your local benefit coordinator to find out if your re- fund will affect your benefits.

Simple. Safe. Secure. DIRECT DEPOSIT

Fast Refunds! Choose direct deposit—a fast, simple, safe, secure way to have your refund deposited automatically to your checking or savings account, including an individual retirement arrangement (IRA). See the information about IRAs later.

If you want us to directly deposit the amount shown on line 74a to your checking or savings account, including an IRA, at a bank or other financial in- stitution (such as a mutual fund, broker- age firm, or credit union) in the United States:

Complete lines 74b through 74d (if you want your refund deposited to only one account), or

Check the box on line 74a and at- tach Form 8888 if you want to split the direct deposit of your refund into more than one account or use all or part of your refund to buy paper series I savings bonds.

If you do not want your refund direct- ly deposited to your account, do not check the box on line 74a. Draw a line through the boxes on lines 74b and 74d. We will send you a check instead.

Do not request a deposit of any part of your refund to an account that is not in your name, such as your tax preparer's account.

Why Use Direct Deposit? You get your refund faster by di-

rect deposit than you do by check. Payment is more secure. There is

no check that can get lost or stolen. It is more convenient. You do not

have to make a trip to the bank to depos- it your check.

It saves tax dollars. It costs the government less to refund by direct de- posit.

If you file a joint return and check the box on line 74a and attach Form 8888 or fill in

lines 74b through 74d, your spouse may get at least part of the refund.

IRA. You can have your refund (or part of it) directly deposited to a traditional IRA, Roth IRA, or SEP-IRA, but not a SIMPLE IRA. You must establish the

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IRA at a bank or other financial institu- tion before you request direct deposit. Make sure your direct deposit will be accepted. You must also notify the trust- ee or custodian of your account of the year to which the deposit is to be applied (unless the trustee or custodian will not accept a deposit for 2012). If you do not, the trustee or custodian can assume the deposit is for the year during which you are filing the return. For example, if you file your 2012 return during 2013 and do not notify the trustee or custodian in ad- vance, the trustee or custodian can as- sume the deposit to your IRA is for 2013. If you designate your deposit to be for 2012, you must verify that the depos- it was actually made to the account by the due date of the return (without re- gard to extensions). If the deposit is not made by that date, the deposit is not an IRA contribution for 2012. In that case, you must file an amended 2012 return and reduce any IRA deduction and any retirement savings contributions credit you claimed.

You and your spouse, if filing jointly, each may be able to contribute up to $5,000

($6,000 if age 50 or older at the end of 2012) to a traditional IRA or Roth IRA for 2012. The limit for 2013 is $5,500 ($6,500 if age 50 or older at the end of 2013). You may owe a penalty if your contributions exceed these limits.

For more information on IRAs, see Pub. 590. TreasuryDirect®. You can request a deposit of your refund (or part of it) to a TreasuryDirect® online account to buy U.S. Treasury marketable securities and savings bonds. For more information, go to www.treasurydirect.gov. Form 8888. You can have your refund directly deposited into more than one ac- count or use it to buy up to $5,000 in pa- per series I savings bonds. You do not need a TreasuryDirect® account to do this. For more information, see the Form 8888 instructions.

Line 74a You cannot file Form 8888 to split your refund into more than one account or buy paper series I savings bonds if Form 8379 is filed with your return.

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2012 Form 1040—Lines 74b Through 76

Line 74b The routing number must be nine digits. The first two digits must be 01 through 12 or 21 through 32. On the sample check below, the routing number is 250250025. Tony and Jennifer Maple would use that routing number unless their financial institution instructed them to use a different routing number for di- rect deposits.

Ask your financial institution for the correct routing number to enter on line 74b if:

The routing number on a deposit slip is different from the routing number on your checks,

Your deposit is to a savings ac- count that does not allow you to write checks, or

Your checks state they are payable through a financial institution different from the one at which you have your checking account.

Line 74c Check the appropriate box for the type of account. Do not check more than one box. If the deposit is to an account such as an IRA, health savings account, bro- kerage account, or other similar account, ask your financial institution whether you should check the “Checking” or “Savings” box. You must check the cor- rect box to ensure your deposit is accep- ted. For a TreasuryDirect® online ac- count, check the “Savings” box.

Line 74d The account number can be up to 17 characters (both numbers and letters). Include hyphens but omit spaces and special symbols. Enter the number from left to right and leave any unused boxes blank. On the sample check below, the account number is 20202086. Do not in- clude the check number.

If the direct deposit to your ac- count(s) is different from the amount you expected, you will receive an ex- planation in the mail about 2 weeks after your refund is deposited.

Reasons Your Direct Deposit Request May Be Rejected If any of the following apply, your direct deposit request will be rejected and a check will be sent instead.

Any numbers or letters on lines 74b through 74d are crossed out or whi- ted out.

Your financial institution(s) will not allow a joint refund to be deposited to an individual account. The IRS is not responsible if a financial institution re- jects a direct deposit.

You file your 2012 return after De- cember 31, 2013.

The IRS is not responsible for a lost refund if you enter the wrong account information.

Check with your financial institution to get the correct routing and account numbers and to make sure your direct deposit will be accepted.

Line 75 Applied to Your 2013 Estimated Tax Enter on line 75 the amount, if any, of the overpayment on line 73 you want applied to your 2013 estimated tax. We will apply this amount to your account unless you include a statement request- ing us to apply it to your spouse's ac- count. Include your spouse's social se- curity number in the statement.

CAUTION !

This election to apply part or all of the amount overpaid to your 2013 estimated tax can-

not be changed later.

Amount You Owe IRS e-file offers two elec- tronic payment options.

With Electronic Funds Withdrawal, you can pay your current year balance due and also make up to four estimated tax payments. If you file early, you can schedule your payment for withdrawal from your account on a future date, up to and including the due date of the re- turn. Or you can pay using a credit or debit card. Visit www.irs.gov/e-pay for details on both options.

Line 76 Amount You Owe

To save interest and penalties, pay your taxes in full by April 15, 2013. You do not have to

pay if line 76 is under $1.

Include any estimated tax penalty from line 77 in the amount you enter on line 76.

You can pay online, by phone, or by check or money order. Do not include any estimated tax payment for 2013 in this payment. Instead, make the estima- ted tax payment separately. Bad check or payment. The penalty for writing a bad check to the IRS is $25

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Do not include the check number.

1234

SA M

PL E

TONY MAPLE JENNIFER MAPLE 123 Pear Lane Anyplace, GA 00000

15-0000/0000

PAY TO THE ORDER OF $

DOLLARS

ANYPLACE BANK Anyplace, GA 00000

For

|:250250025|:202020"’86". 1234

The routing and account numbers may be in different places on your check.

(line 74b) (line 74d)

Routing number

Account number

�

�

Sample Check—Lines 74b Through 74d

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or 2% of the check, whichever is more. However, if the amount of the check is less than $25, the penalty equals the amount of the check. This penalty also applies to other forms of payment if the IRS does not receive the funds. Use Tel- eTax topic 206.

Pay Online Paying online is convenient and secure and helps make sure we get your pay- ments on time. You can pay using either of the following electronic payment methods.

Direct transfer from your bank ac- count.

Credit or debit card. To pay your taxes online or for more in- formation, go to www.irs.gov/e-pay. Al- so see Amount You Owe, earlier, for in- formation about the Electronic Funds Withdrawal payment option offered when e-filing your return.

Pay by Phone Paying by phone is another safe and se- cure method of paying electronically. Use one of the following methods.

Direct transfer from your bank ac- count.

Credit or debit card. To pay by direct transfer from your

bank account, call 1-800-555-4477 (English) or 1-800-244-4829 (Espanol). People who are deaf, hard of hearing, or have a speech disability and who have access to TTY/TDD equipment can call 1-800-733-4829.

To pay using a credit or debit card, you can call one of the following service providers. There is a convenience fee charged by these providers that varies by provider, card type, and payment amount.

Official Payments Corporation 1-888-UPAY-TAXTM (1-888-872-9829) www.officialpayments.com

Link2Gov Corporation 1-888-PAY-1040TM (1-888-729-1040) www.PAY1040.com

WorldPay 1-888-9-PAY-TAXTM (1-888-972-9829) www.payUSAtax.com

For the latest details on how to pay by phone, go to www.irs.gov/e-pay.

Pay by Check or Money Order Make your check or money order paya- ble to “United States Treasury” for the full amount due. Do not send cash. Do not attach the payment to your return. Write “2012 Form 1040” and your name, address, daytime phone number, and social security number (SSN) on your payment. If you are filing a joint return, enter the SSN shown first on your tax return.

To help us process your payment, en- ter the amount on the right side of the check like this: $ XXX.XX. Do not use dashes or lines (for example, do not en- ter “$ XXX–” or “$ XXXxx 100”).

Then, complete Form 1040-V follow- ing the instructions on that form and en- close it in the envelope with your tax re- turn and payment.

You may need to (a) increase the amount of income tax with- held from your pay by filing a

new Form W-4, (b) increase the tax withheld from other income by filing Form W-4P or W-4V, or (c) make esti- mated tax payments for 2013. See In- come Tax Withholding and Estimated Tax Payments for 2013 under General Information, later.

What If You Cannot Pay? If you cannot pay the full amount shown on line 76 when you file, you can ask for:

An installment agreement, or An extension of time to pay.

Installment agreement. Under an in- stallment agreement, you can pay all or part of the tax you owe in monthly in- stallments. However, even if your re- quest to pay in installments is granted, you will be charged interest and may be charged a late payment penalty on the tax not paid by April 15, 2013. You must also pay a fee. To limit the interest and penalty charges, pay as much of the tax as possible when you file. But before

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requesting an installment agreement, you should consider other less costly al- ternatives, such as a bank loan or credit card payment.

To ask for an installment agreement, you can apply online or use Form 9465. To apply online, go to IRS.gov and click on “Tools” and then “Online Payment Agreement.” Extension of time to pay. If paying the tax when it is due would cause you an undue hardship, you can ask for an ex- tension of time to pay by filing Form 1127 by April 15, 2013. An extension generally will not be granted for more than 6 months. If you pay after April 15, 2013, you will be charged interest on the tax not paid by April 15, 2013. You must pay the tax before the extension runs out. If you do not, penalties may be imposed.

Line 77 Estimated Tax Penalty You may owe this penalty if:

Line 76 is at least $1,000 and it is more than 10% of the tax shown on your return, or

You did not pay enough estimated tax by any of the due dates. This is true even if you are due a refund.

For most people, the “tax shown on your return” is the amount on your 2012 Form 1040, line 61, minus the total of any amounts shown on lines 64a, 65, 66, and 70 and Forms 8828, 4137, 5329 (Parts III through VIII only), 8801 (line 27 only), 8885, and 8919. Also subtract from line 61 any tax on an ex- cess parachute payment, any excise tax on insider stock compensation of an ex- patriated corporation, any uncollected social security and Medicare or RRTA tax on tips or group-term life insurance, any look-back interest due under section 167(g) or 460(b), and any write-in tax included on line 60 from Form 8885. When figuring the amount on line 61, include household employment taxes only if line 62 is more than zero or you would owe the penalty even if you did not include those taxes. Exception. You will not owe the penal- ty if your 2011 tax return was for a tax year of 12 full months and either of the following applies.

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1. You had no tax shown on your 2011 return and you were a U.S. citizen or resident for all of 2011.

2. The total of lines 62, 63, and 69 on your 2012 return is at least 100% of the tax shown on your 2011 return (110% of that amount if you are not a farmer or fisherman, and your adjusted gross income (AGI) shown on your 2011 return was more than $150,000 (more than $75,000 if married filing separately for 2012)). Your estimated tax payments for 2012 must have been made on time and for the required amount.

For most people, the “tax shown on your 2011 return” is the amount on your 2011 Form 1040, line 61, minus the total of any amounts shown on lines 64a, 65, 66, 67, and 70 and Forms 8828, 4137, 5329 (Parts III through VIII only), 8801 (line 27 only), 8839, 8885, and 8919. Also subtract from line 61 any tax on an excess parachute payment, any excise tax on insider stock compensation of an expatriated corporation, any uncollected social security and Medicare or RRTA tax on tips or group-term life insurance, any look-back interest due under section 167(g) or 460(b), and any write-in tax included on line 60 from Form 8885. When figuring the amount on line 61, include household employment taxes only if line 62 is more than zero or you would have owed the estimated tax pen- alty for 2011 even if you did not include those taxes.

Figuring the Penalty If the Exception just described does not apply and you choose to figure the pen- alty yourself, use Form 2210 (or 2210-F for farmers and fishermen).

Enter any penalty on line 77. Add the penalty to any tax due and enter the total on line 76.

However, if you have an overpay- ment on line 73, subtract the penalty from the amount you would otherwise enter on line 74a or line 75. Lines 74a, 75, and 77 must equal line 73.

If the penalty is more than the over- payment on line 73, enter -0- on lines 74a and 75. Then subtract line 73 from line 77 and enter the result on line 76.

Do not file Form 2210 with your re- turn unless Form 2210 indicates that you must do so. Instead, keep it for your re- cords.

Because Form 2210 is compli- cated, you can leave line 77 blank and the IRS will figure

the penalty and send you a bill. We will not charge you interest on the penalty if you pay by the date specified on the bill. If your income varied during the year, the annualized income installment meth- od may reduce the amount of your pen- alty. But you must file Form 2210 be- cause the IRS cannot figure your penalty under this method. See the Instructions for Form 2210 for other situations in which you may be able to lower your penalty by filing Form 2210.

Third Party Designee If you want to allow your preparer, a friend, a family member, or any other person you choose to discuss your 2012 tax return with the IRS, check the “Yes” box in the “Third Party Designee” area of your return. Also, enter the designee's name, phone number, and any five digits the designee chooses as his or her per- sonal identification number (PIN).

If you check the “Yes” box, you, and your spouse if filing a joint return, are authorizing the IRS to call the designee to answer any questions that may arise during the processing of your return. You are also authorizing the designee to:

Give the IRS any information that is missing from your return,

Call the IRS for information about the processing of your return or the sta- tus of your refund or payment(s),

Receive copies of notices or tran- scripts related to your return, upon re- quest, and

Respond to certain IRS notices about math errors, offsets, and return preparation.

You are not authorizing the designee to receive any refund check, bind you to anything (including any additional tax liability), or otherwise represent you be- fore the IRS. If you want to expand the designee's authorization, see Pub. 947.

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The authorization will automatically end no later than the due date (without regard to extensions) for filing your 2013 tax return. This is April 15, 2014, for most people.

Sign Your Return Form 1040 is not considered a valid re- turn unless you sign it. If you are filing a joint return, your spouse must also sign. If your spouse cannot sign the return, see Pub. 501. Be sure to date your return and enter your occupation(s). If you have someone prepare your return, you are still responsible for the correctness of the return. If your return is signed by a representative for you, you must have a power of attorney attached that specifi- cally authorizes the representative to sign your return. To do this, you can use Form 2848. If you are filing a joint re- turn as a surviving spouse, see Death of a Taxpayer, later.

Court-Appointed Conservator, Guardian, or Other Fiduciary If you are a court-appointed conservator, guardian, or other fiduciary for a men- tally or physically incompetent individu- al who has to file Form 1040, sign your name for the individual and file Form 56.

Child's Return If your child cannot sign the return, ei- ther parent can sign the child's name in the space provided. Then, enter “By (your signature), parent for minor child.”

Daytime Phone Number Providing your daytime phone number may help speed the processing of your return. We may have questions about items on your return, such as the earned income credit, credit for child and de- pendent care expenses, etc. If you an- swer our questions over the phone, we may be able to continue processing your return without mailing you a letter. If you are filing a joint return, you can en- ter either your or your spouse's daytime phone number.

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Electronic Return Signatures! To file your return electronically, you must sign the return electronically using a personal identification number (PIN). If you are filing online using software, you must use a Self-Select PIN. If you are filing electronically using a tax prac- titioner, you can use a Self-Select PIN or a Practitioner PIN. Self­Select PIN. The Self-Select PIN method allows you to create your own PIN. If you are married filing jointly, you and your spouse will each need to create a PIN and enter these PINs as your electronic signatures.

A PIN is any combination of five dig- its you choose except five zeros. If you use a PIN, there is nothing to sign and nothing to mail—not even your Forms W-2.

To verify your identity, you will be prompted to enter your adjusted gross income (AGI) from your originally filed 2011 federal income tax return, if appli- cable. Do not use your AGI from an amended return (Form 1040X) or a math error correction made by IRS. AGI is the amount shown on your 2011 Form 1040, line 38; Form 1040A, line 22; or Form 1040EZ, line 4. If you do not have your 2011 income tax return, call the IRS at 1-800-908-9946 to get a free transcript of your return or visit IRS.gov and click on “Order a Return or Account Tran- script.” (If you filed electronically last year, you may use your prior year PIN to verify your identity instead of your prior year AGI. The prior year PIN is the five digit PIN you used to electroni- cally sign your 2011 return.) You will also be prompted to enter your date of birth (DOB).

You cannot use the Self-Select PIN method if you are a first-time filer under age 16 at

the end of 2012.

If you cannot locate your prior year AGI or prior year PIN, use the Electronic Filing PIN

Request. This can be found at IRS.gov. Click on “Request an Electronic Filing PIN.” Or you can call 1-866-704-7388.

Practitioner PIN. The Practitioner PIN method allows you to authorize your tax practitioner to enter or generate your PIN. The practitioner can provide you with details. Form 8453. You must send in a paper Form 8453 if you have to attach certain forms or other documents that cannot be electronically filed. For details, see Form 8453.

Identity Protection PIN For 2012, if you received an IRS notice providing you with an Identity Protec- tion Personal Identification Number (IP PIN), enter it in the IP PIN spaces provi- ded below your daytime phone number. You must enter your IP PIN exactly as it is shown on the Notice CP01A you re- ceived. If you did not receive a notice containing an IP PIN, leave these spaces blank.

New IP PINs are issued every year. An IP PIN should be used only for the tax year it

was issued. IP PINs for 2012 tax returns generally were sent in December 2012.

If you are filing a joint return and both taxpayers receive an IP PIN, only the taxpayer whose social security num-

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ber (SSN) appears first on the tax return should enter his or her IP PIN.

If you received an IP PIN but mis- placed it, call 1-800-908-4490, exten- sion 245. If you need more information or answers to frequently asked questions on how to use the IP PIN, go to www.irs.gov/Individuals/Understanding- Your-CP01A-Notice.

Paid Preparer Must Sign Your Return Generally, anyone you pay to prepare your return must sign it and include their Preparer Tax Identification Number (PTIN) in the space provided. The pre- parer must give you a copy of the return for your records. Someone who prepares your return but does not charge you should not sign your return.

Assemble Your Return Assemble any schedules and forms be- hind Form 1040 in order of the “Attach- ment Sequence No.” shown in the upper right corner of the schedule or form. If you have supporting statements, arrange them in the same order as the schedules or forms they support and attach them last. Do not attach correspondence or other items unless required to do so. At- tach a copy of Forms W-2 and 2439 to the front of Form 1040. If you received a Form W-2c (a corrected Form W-2), attach a copy of your original Forms W-2 and any Forms W-2c. Also attach Forms W-2G and 1099-R to the front of Form 1040 if tax was withheld.

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2012 Tax Table CAUTION!

See the instructions for line 44 to see if you must use the Tax Table below to figure your tax.

At Least

But Less Than

Single Married �ling jointly *

Married �ling sepa- rately

Head of a house- hold

Your tax is— 25,200 25,250 25,300 25,350

3,349 3,356 3,364 3,371

Sample Table

25,250 25,300 25,350 25,400

2,914 2,921 2,929 2,936

3,349 3,356 3,364 3,371

3,164 3,171 3,179 3,186

Example. Mr. and Mrs. Brown are filing a joint return. Their taxable income on Form 1040, line 43, is $25,300. First, they find the $25,300–25,350 taxable income line. Next, they find the column for married filing jointly and read down the column. The amount shown where the taxable income line and filing status column meet is $2,929. This is the tax amount they should enter on Form 1040, line 44.

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— . . . . . .

0 5 0 0 0 0 5 15 1 1 1 1

15 25 2 2 2 2 25 50 4 4 4 4 50 75 6 6 6 6 75 100 9 9 9 9

100 125 11 11 11 11 125 150 14 14 14 14 150 175 16 16 16 16 175 200 19 19 19 19 200 225 21 21 21 21 225 250 24 24 24 24 250 275 26 26 26 26 275 300 29 29 29 29 300 325 31 31 31 31 325 350 34 34 34 34 350 375 36 36 36 36 375 400 39 39 39 39 400 425 41 41 41 41 425 450 44 44 44 44 450 475 46 46 46 46 475 500 49 49 49 49 500 525 51 51 51 51 525 550 54 54 54 54 550 575 56 56 56 56 575 600 59 59 59 59 600 625 61 61 61 61 625 650 64 64 64 64 650 675 66 66 66 66 675 700 69 69 69 69 700 725 71 71 71 71 725 750 74 74 74 74 750 775 76 76 76 76 775 800 79 79 79 79 800 825 81 81 81 81 825 850 84 84 84 84 850 875 86 86 86 86 875 900 89 89 89 89 900 925 91 91 91 91 925 950 94 94 94 94 950 975 96 96 96 96 975 1,000 99 99 99 99

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 1,000

1,000 1,025 101 101 101 101 1,025 1,050 104 104 104 104 1,050 1,075 106 106 106 106 1,075 1,100 109 109 109 109 1,100 1,125 111 111 111 111 1,125 1,150 114 114 114 114 1,150 1,175 116 116 116 116 1,175 1,200 119 119 119 119 1,200 1,225 121 121 121 121 1,225 1,250 124 124 124 124 1,250 1,275 126 126 126 126 1,275 1,300 129 129 129 129 1,300 1,325 131 131 131 131 1,325 1,350 134 134 134 134 1,350 1,375 136 136 136 136 1,375 1,400 139 139 139 139 1,400 1,425 141 141 141 141 1,425 1,450 144 144 144 144 1,450 1,475 146 146 146 146 1,475 1,500 149 149 149 149 1,500 1,525 151 151 151 151 1,525 1,550 154 154 154 154 1,550 1,575 156 156 156 156 1,575 1,600 159 159 159 159 1,600 1,625 161 161 161 161 1,625 1,650 164 164 164 164 1,650 1,675 166 166 166 166 1,675 1,700 169 169 169 169 1,700 1,725 171 171 171 171 1,725 1,750 174 174 174 174 1,750 1,775 176 176 176 176 1,775 1,800 179 179 179 179 1,800 1,825 181 181 181 181 1,825 1,850 184 184 184 184 1,850 1,875 186 186 186 186 1,875 1,900 189 189 189 189 1,900 1,925 191 191 191 191 1,925 1,950 194 194 194 194 1,950 1,975 196 196 196 196 1,975 2,000 199 199 199 199

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 2,000

2,000 2,025 201 201 201 201 2,025 2,050 204 204 204 204 2,050 2,075 206 206 206 206 2,075 2,100 209 209 209 209 2,100 2,125 211 211 211 211 2,125 2,150 214 214 214 214 2,150 2,175 216 216 216 216 2,175 2,200 219 219 219 219 2,200 2,225 221 221 221 221 2,225 2,250 224 224 224 224 2,250 2,275 226 226 226 226 2,275 2,300 229 229 229 229 2,300 2,325 231 231 231 231 2,325 2,350 234 234 234 234 2,350 2,375 236 236 236 236 2,375 2,400 239 239 239 239 2,400 2,425 241 241 241 241 2,425 2,450 244 244 244 244 2,450 2,475 246 246 246 246 2,475 2,500 249 249 249 249 2,500 2,525 251 251 251 251 2,525 2,550 254 254 254 254 2,550 2,575 256 256 256 256 2,575 2,600 259 259 259 259 2,600 2,625 261 261 261 261 2,625 2,650 264 264 264 264 2,650 2,675 266 266 266 266 2,675 2,700 269 269 269 269 2,700 2,725 271 271 271 271 2,725 2,750 274 274 274 274 2,750 2,775 276 276 276 276 2,775 2,800 279 279 279 279 2,800 2,825 281 281 281 281 2,825 2,850 284 284 284 284 2,850 2,875 286 286 286 286 2,875 2,900 289 289 289 289 2,900 2,925 291 291 291 291 2,925 2,950 294 294 294 294 2,950 2,975 296 296 296 296 2,975 3,000 299 299 299 299

(Continued)

*This column must also be used by a qualifying widow(er).

-79- Need more information or forms? Visit IRS.gov.

Page 80 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

2012 Tax Table—Continued If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 3,000

3,000 3,050 303 303 303 303 3,050 3,100 308 308 308 308 3,100 3,150 313 313 313 313 3,150 3,200 318 318 318 318 3,200 3,250 323 323 323 323 3,250 3,300 328 328 328 328 3,300 3,350 333 333 333 333 3,350 3,400 338 338 338 338 3,400 3,450 343 343 343 343 3,450 3,500 348 348 348 348 3,500 3,550 353 353 353 353 3,550 3,600 358 358 358 358 3,600 3,650 363 363 363 363 3,650 3,700 368 368 368 368 3,700 3,750 373 373 373 373 3,750 3,800 378 378 378 378 3,800 3,850 383 383 383 383 3,850 3,900 388 388 388 388 3,900 3,950 393 393 393 393 3,950 4,000 398 398 398 398 4,000

4,000 4,050 403 403 403 403 4,050 4,100 408 408 408 408 4,100 4,150 413 413 413 413 4,150 4,200 418 418 418 418 4,200 4,250 423 423 423 423 4,250 4,300 428 428 428 428 4,300 4,350 433 433 433 433 4,350 4,400 438 438 438 438 4,400 4,450 443 443 443 443 4,450 4,500 448 448 448 448 4,500 4,550 453 453 453 453 4,550 4,600 458 458 458 458 4,600 4,650 463 463 463 463 4,650 4,700 468 468 468 468 4,700 4,750 473 473 473 473 4,750 4,800 478 478 478 478 4,800 4,850 483 483 483 483 4,850 4,900 488 488 488 488 4,900 4,950 493 493 493 493 4,950 5,000 498 498 498 498 5,000

5,000 5,050 503 503 503 503 5,050 5,100 508 508 508 508 5,100 5,150 513 513 513 513 5,150 5,200 518 518 518 518 5,200 5,250 523 523 523 523 5,250 5,300 528 528 528 528 5,300 5,350 533 533 533 533 5,350 5,400 538 538 538 538 5,400 5,450 543 543 543 543 5,450 5,500 548 548 548 548 5,500 5,550 553 553 553 553 5,550 5,600 558 558 558 558 5,600 5,650 563 563 563 563 5,650 5,700 568 568 568 568 5,700 5,750 573 573 573 573 5,750 5,800 578 578 578 578 5,800 5,850 583 583 583 583 5,850 5,900 588 588 588 588 5,900 5,950 593 593 593 593 5,950 6,000 598 598 598 598

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 6,000

6,000 6,050 603 603 603 603 6,050 6,100 608 608 608 608 6,100 6,150 613 613 613 613 6,150 6,200 618 618 618 618 6,200 6,250 623 623 623 623 6,250 6,300 628 628 628 628 6,300 6,350 633 633 633 633 6,350 6,400 638 638 638 638 6,400 6,450 643 643 643 643 6,450 6,500 648 648 648 648 6,500 6,550 653 653 653 653 6,550 6,600 658 658 658 658 6,600 6,650 663 663 663 663 6,650 6,700 668 668 668 668 6,700 6,750 673 673 673 673 6,750 6,800 678 678 678 678 6,800 6,850 683 683 683 683 6,850 6,900 688 688 688 688 6,900 6,950 693 693 693 693 6,950 7,000 698 698 698 698 7,000

7,000 7,050 703 703 703 703 7,050 7,100 708 708 708 708 7,100 7,150 713 713 713 713 7,150 7,200 718 718 718 718 7,200 7,250 723 723 723 723 7,250 7,300 728 728 728 728 7,300 7,350 733 733 733 733 7,350 7,400 738 738 738 738 7,400 7,450 743 743 743 743 7,450 7,500 748 748 748 748 7,500 7,550 753 753 753 753 7,550 7,600 758 758 758 758 7,600 7,650 763 763 763 763 7,650 7,700 768 768 768 768 7,700 7,750 773 773 773 773 7,750 7,800 778 778 778 778 7,800 7,850 783 783 783 783 7,850 7,900 788 788 788 788 7,900 7,950 793 793 793 793 7,950 8,000 798 798 798 798 8,000

8,000 8,050 803 803 803 803 8,050 8,100 808 808 808 808 8,100 8,150 813 813 813 813 8,150 8,200 818 818 818 818 8,200 8,250 823 823 823 823 8,250 8,300 828 828 828 828 8,300 8,350 833 833 833 833 8,350 8,400 838 838 838 838 8,400 8,450 843 843 843 843 8,450 8,500 848 848 848 848 8,500 8,550 853 853 853 853 8,550 8,600 858 858 858 858 8,600 8,650 863 863 863 863 8,650 8,700 868 868 868 868 8,700 8,750 874 873 874 873 8,750 8,800 881 878 881 878 8,800 8,850 889 883 889 883 8,850 8,900 896 888 896 888 8,900 8,950 904 893 904 893 8,950 9,000 911 898 911 898

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 9,000

9,000 9,050 919 903 919 903 9,050 9,100 926 908 926 908 9,100 9,150 934 913 934 913 9,150 9,200 941 918 941 918 9,200 9,250 949 923 949 923 9,250 9,300 956 928 956 928 9,300 9,350 964 933 964 933 9,350 9,400 971 938 971 938 9,400 9,450 979 943 979 943 9,450 9,500 986 948 986 948 9,500 9,550 994 953 994 953 9,550 9,600 1,001 958 1,001 958 9,600 9,650 1,009 963 1,009 963 9,650 9,700 1,016 968 1,016 968 9,700 9,750 1,024 973 1,024 973 9,750 9,800 1,031 978 1,031 978 9,800 9,850 1,039 983 1,039 983 9,850 9,900 1,046 988 1,046 988 9,900 9,950 1,054 993 1,054 993 9,950 10,000 1,061 998 1,061 998 10,000

10,000 10,050 1,069 1,003 1,069 1,003 10,050 10,100 1,076 1,008 1,076 1,008 10,100 10,150 1,084 1,013 1,084 1,013 10,150 10,200 1,091 1,018 1,091 1,018 10,200 10,250 1,099 1,023 1,099 1,023 10,250 10,300 1,106 1,028 1,106 1,028 10,300 10,350 1,114 1,033 1,114 1,033 10,350 10,400 1,121 1,038 1,121 1,038 10,400 10,450 1,129 1,043 1,129 1,043 10,450 10,500 1,136 1,048 1,136 1,048 10,500 10,550 1,144 1,053 1,144 1,053 10,550 10,600 1,151 1,058 1,151 1,058 10,600 10,650 1,159 1,063 1,159 1,063 10,650 10,700 1,166 1,068 1,166 1,068 10,700 10,750 1,174 1,073 1,174 1,073 10,750 10,800 1,181 1,078 1,181 1,078 10,800 10,850 1,189 1,083 1,189 1,083 10,850 10,900 1,196 1,088 1,196 1,088 10,900 10,950 1,204 1,093 1,204 1,093 10,950 11,000 1,211 1,098 1,211 1,098

11,000 11,000 11,050 1,219 1,103 1,219 1,103 11,050 11,100 1,226 1,108 1,226 1,108 11,100 11,150 1,234 1,113 1,234 1,113 11,150 11,200 1,241 1,118 1,241 1,118 11,200 11,250 1,249 1,123 1,249 1,123 11,250 11,300 1,256 1,128 1,256 1,128 11,300 11,350 1,264 1,133 1,264 1,133 11,350 11,400 1,271 1,138 1,271 1,138 11,400 11,450 1,279 1,143 1,279 1,143 11,450 11,500 1,286 1,148 1,286 1,148 11,500 11,550 1,294 1,153 1,294 1,153 11,550 11,600 1,301 1,158 1,301 1,158 11,600 11,650 1,309 1,163 1,309 1,163 11,650 11,700 1,316 1,168 1,316 1,168 11,700 11,750 1,324 1,173 1,324 1,173 11,750 11,800 1,331 1,178 1,331 1,178 11,800 11,850 1,339 1,183 1,339 1,183 11,850 11,900 1,346 1,188 1,346 1,188 11,900 11,950 1,354 1,193 1,354 1,193 11,950 12,000 1,361 1,198 1,361 1,198

(Continued)

*This column must also be used by a qualifying widow(er).

Need more information or forms? Visit IRS.gov. -80-

Page 81 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

2012 Tax Table—Continued If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 12,000

12,000 12,050 1,369 1,203 1,369 1,203 12,050 12,100 1,376 1,208 1,376 1,208 12,100 12,150 1,384 1,213 1,384 1,213 12,150 12,200 1,391 1,218 1,391 1,218 12,200 12,250 1,399 1,223 1,399 1,223 12,250 12,300 1,406 1,228 1,406 1,228 12,300 12,350 1,414 1,233 1,414 1,233 12,350 12,400 1,421 1,238 1,421 1,238 12,400 12,450 1,429 1,243 1,429 1,244 12,450 12,500 1,436 1,248 1,436 1,251 12,500 12,550 1,444 1,253 1,444 1,259 12,550 12,600 1,451 1,258 1,451 1,266 12,600 12,650 1,459 1,263 1,459 1,274 12,650 12,700 1,466 1,268 1,466 1,281 12,700 12,750 1,474 1,273 1,474 1,289 12,750 12,800 1,481 1,278 1,481 1,296 12,800 12,850 1,489 1,283 1,489 1,304 12,850 12,900 1,496 1,288 1,496 1,311 12,900 12,950 1,504 1,293 1,504 1,319 12,950 13,000 1,511 1,298 1,511 1,326

13,000 13,000 13,050 1,519 1,303 1,519 1,334 13,050 13,100 1,526 1,308 1,526 1,341 13,100 13,150 1,534 1,313 1,534 1,349 13,150 13,200 1,541 1,318 1,541 1,356 13,200 13,250 1,549 1,323 1,549 1,364 13,250 13,300 1,556 1,328 1,556 1,371 13,300 13,350 1,564 1,333 1,564 1,379 13,350 13,400 1,571 1,338 1,571 1,386 13,400 13,450 1,579 1,343 1,579 1,394 13,450 13,500 1,586 1,348 1,586 1,401 13,500 13,550 1,594 1,353 1,594 1,409 13,550 13,600 1,601 1,358 1,601 1,416 13,600 13,650 1,609 1,363 1,609 1,424 13,650 13,700 1,616 1,368 1,616 1,431 13,700 13,750 1,624 1,373 1,624 1,439 13,750 13,800 1,631 1,378 1,631 1,446 13,800 13,850 1,639 1,383 1,639 1,454 13,850 13,900 1,646 1,388 1,646 1,461 13,900 13,950 1,654 1,393 1,654 1,469 13,950 14,000 1,661 1,398 1,661 1,476

14,000 14,000 14,050 1,669 1,403 1,669 1,484 14,050 14,100 1,676 1,408 1,676 1,491 14,100 14,150 1,684 1,413 1,684 1,499 14,150 14,200 1,691 1,418 1,691 1,506 14,200 14,250 1,699 1,423 1,699 1,514 14,250 14,300 1,706 1,428 1,706 1,521 14,300 14,350 1,714 1,433 1,714 1,529 14,350 14,400 1,721 1,438 1,721 1,536 14,400 14,450 1,729 1,443 1,729 1,544 14,450 14,500 1,736 1,448 1,736 1,551 14,500 14,550 1,744 1,453 1,744 1,559 14,550 14,600 1,751 1,458 1,751 1,566 14,600 14,650 1,759 1,463 1,759 1,574 14,650 14,700 1,766 1,468 1,766 1,581 14,700 14,750 1,774 1,473 1,774 1,589 14,750 14,800 1,781 1,478 1,781 1,596 14,800 14,850 1,789 1,483 1,789 1,604 14,850 14,900 1,796 1,488 1,796 1,611 14,900 14,950 1,804 1,493 1,804 1,619 14,950 15,000 1,811 1,498 1,811 1,626

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 15,000

15,000 15,050 1,819 1,503 1,819 1,634 15,050 15,100 1,826 1,508 1,826 1,641 15,100 15,150 1,834 1,513 1,834 1,649 15,150 15,200 1,841 1,518 1,841 1,656 15,200 15,250 1,849 1,523 1,849 1,664 15,250 15,300 1,856 1,528 1,856 1,671 15,300 15,350 1,864 1,533 1,864 1,679 15,350 15,400 1,871 1,538 1,871 1,686 15,400 15,450 1,879 1,543 1,879 1,694 15,450 15,500 1,886 1,548 1,886 1,701 15,500 15,550 1,894 1,553 1,894 1,709 15,550 15,600 1,901 1,558 1,901 1,716 15,600 15,650 1,909 1,563 1,909 1,724 15,650 15,700 1,916 1,568 1,916 1,731 15,700 15,750 1,924 1,573 1,924 1,739 15,750 15,800 1,931 1,578 1,931 1,746 15,800 15,850 1,939 1,583 1,939 1,754 15,850 15,900 1,946 1,588 1,946 1,761 15,900 15,950 1,954 1,593 1,954 1,769 15,950 16,000 1,961 1,598 1,961 1,776

16,000 16,000 16,050 1,969 1,603 1,969 1,784 16,050 16,100 1,976 1,608 1,976 1,791 16,100 16,150 1,984 1,613 1,984 1,799 16,150 16,200 1,991 1,618 1,991 1,806 16,200 16,250 1,999 1,623 1,999 1,814 16,250 16,300 2,006 1,628 2,006 1,821 16,300 16,350 2,014 1,633 2,014 1,829 16,350 16,400 2,021 1,638 2,021 1,836 16,400 16,450 2,029 1,643 2,029 1,844 16,450 16,500 2,036 1,648 2,036 1,851 16,500 16,550 2,044 1,653 2,044 1,859 16,550 16,600 2,051 1,658 2,051 1,866 16,600 16,650 2,059 1,663 2,059 1,874 16,650 16,700 2,066 1,668 2,066 1,881 16,700 16,750 2,074 1,673 2,074 1,889 16,750 16,800 2,081 1,678 2,081 1,896 16,800 16,850 2,089 1,683 2,089 1,904 16,850 16,900 2,096 1,688 2,096 1,911 16,900 16,950 2,104 1,693 2,104 1,919 16,950 17,000 2,111 1,698 2,111 1,926

17,000 17,000 17,050 2,119 1,703 2,119 1,934 17,050 17,100 2,126 1,708 2,126 1,941 17,100 17,150 2,134 1,713 2,134 1,949 17,150 17,200 2,141 1,718 2,141 1,956 17,200 17,250 2,149 1,723 2,149 1,964 17,250 17,300 2,156 1,728 2,156 1,971 17,300 17,350 2,164 1,733 2,164 1,979 17,350 17,400 2,171 1,738 2,171 1,986 17,400 17,450 2,179 1,744 2,179 1,994 17,450 17,500 2,186 1,751 2,186 2,001 17,500 17,550 2,194 1,759 2,194 2,009 17,550 17,600 2,201 1,766 2,201 2,016 17,600 17,650 2,209 1,774 2,209 2,024 17,650 17,700 2,216 1,781 2,216 2,031 17,700 17,750 2,224 1,789 2,224 2,039 17,750 17,800 2,231 1,796 2,231 2,046 17,800 17,850 2,239 1,804 2,239 2,054 17,850 17,900 2,246 1,811 2,246 2,061 17,900 17,950 2,254 1,819 2,254 2,069 17,950 18,000 2,261 1,826 2,261 2,076

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 18,000

18,000 18,050 2,269 1,834 2,269 2,084 18,050 18,100 2,276 1,841 2,276 2,091 18,100 18,150 2,284 1,849 2,284 2,099 18,150 18,200 2,291 1,856 2,291 2,106 18,200 18,250 2,299 1,864 2,299 2,114 18,250 18,300 2,306 1,871 2,306 2,121 18,300 18,350 2,314 1,879 2,314 2,129 18,350 18,400 2,321 1,886 2,321 2,136 18,400 18,450 2,329 1,894 2,329 2,144 18,450 18,500 2,336 1,901 2,336 2,151 18,500 18,550 2,344 1,909 2,344 2,159 18,550 18,600 2,351 1,916 2,351 2,166 18,600 18,650 2,359 1,924 2,359 2,174 18,650 18,700 2,366 1,931 2,366 2,181 18,700 18,750 2,374 1,939 2,374 2,189 18,750 18,800 2,381 1,946 2,381 2,196 18,800 18,850 2,389 1,954 2,389 2,204 18,850 18,900 2,396 1,961 2,396 2,211 18,900 18,950 2,404 1,969 2,404 2,219 18,950 19,000 2,411 1,976 2,411 2,226

19,000 19,000 19,050 2,419 1,984 2,419 2,234 19,050 19,100 2,426 1,991 2,426 2,241 19,100 19,150 2,434 1,999 2,434 2,249 19,150 19,200 2,441 2,006 2,441 2,256 19,200 19,250 2,449 2,014 2,449 2,264 19,250 19,300 2,456 2,021 2,456 2,271 19,300 19,350 2,464 2,029 2,464 2,279 19,350 19,400 2,471 2,036 2,471 2,286 19,400 19,450 2,479 2,044 2,479 2,294 19,450 19,500 2,486 2,051 2,486 2,301 19,500 19,550 2,494 2,059 2,494 2,309 19,550 19,600 2,501 2,066 2,501 2,316 19,600 19,650 2,509 2,074 2,509 2,324 19,650 19,700 2,516 2,081 2,516 2,331 19,700 19,750 2,524 2,089 2,524 2,339 19,750 19,800 2,531 2,096 2,531 2,346 19,800 19,850 2,539 2,104 2,539 2,354 19,850 19,900 2,546 2,111 2,546 2,361 19,900 19,950 2,554 2,119 2,554 2,369 19,950 20,000 2,561 2,126 2,561 2,376

20,000 20,000 20,050 2,569 2,134 2,569 2,384 20,050 20,100 2,576 2,141 2,576 2,391 20,100 20,150 2,584 2,149 2,584 2,399 20,150 20,200 2,591 2,156 2,591 2,406 20,200 20,250 2,599 2,164 2,599 2,414 20,250 20,300 2,606 2,171 2,606 2,421 20,300 20,350 2,614 2,179 2,614 2,429 20,350 20,400 2,621 2,186 2,621 2,436 20,400 20,450 2,629 2,194 2,629 2,444 20,450 20,500 2,636 2,201 2,636 2,451 20,500 20,550 2,644 2,209 2,644 2,459 20,550 20,600 2,651 2,216 2,651 2,466 20,600 20,650 2,659 2,224 2,659 2,474 20,650 20,700 2,666 2,231 2,666 2,481 20,700 20,750 2,674 2,239 2,674 2,489 20,750 20,800 2,681 2,246 2,681 2,496 20,800 20,850 2,689 2,254 2,689 2,504 20,850 20,900 2,696 2,261 2,696 2,511 20,900 20,950 2,704 2,269 2,704 2,519 20,950 21,000 2,711 2,276 2,711 2,526

(Continued)

*This column must also be used by a qualifying widow(er).

-81- Need more information or forms? Visit IRS.gov.

Page 82 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

2012 Tax Table—Continued If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 21,000

21,000 21,050 2,719 2,284 2,719 2,534 21,050 21,100 2,726 2,291 2,726 2,541 21,100 21,150 2,734 2,299 2,734 2,549 21,150 21,200 2,741 2,306 2,741 2,556 21,200 21,250 2,749 2,314 2,749 2,564 21,250 21,300 2,756 2,321 2,756 2,571 21,300 21,350 2,764 2,329 2,764 2,579 21,350 21,400 2,771 2,336 2,771 2,586 21,400 21,450 2,779 2,344 2,779 2,594 21,450 21,500 2,786 2,351 2,786 2,601 21,500 21,550 2,794 2,359 2,794 2,609 21,550 21,600 2,801 2,366 2,801 2,616 21,600 21,650 2,809 2,374 2,809 2,624 21,650 21,700 2,816 2,381 2,816 2,631 21,700 21,750 2,824 2,389 2,824 2,639 21,750 21,800 2,831 2,396 2,831 2,646 21,800 21,850 2,839 2,404 2,839 2,654 21,850 21,900 2,846 2,411 2,846 2,661 21,900 21,950 2,854 2,419 2,854 2,669 21,950 22,000 2,861 2,426 2,861 2,676

22,000 22,000 22,050 2,869 2,434 2,869 2,684 22,050 22,100 2,876 2,441 2,876 2,691 22,100 22,150 2,884 2,449 2,884 2,699 22,150 22,200 2,891 2,456 2,891 2,706 22,200 22,250 2,899 2,464 2,899 2,714 22,250 22,300 2,906 2,471 2,906 2,721 22,300 22,350 2,914 2,479 2,914 2,729 22,350 22,400 2,921 2,486 2,921 2,736 22,400 22,450 2,929 2,494 2,929 2,744 22,450 22,500 2,936 2,501 2,936 2,751 22,500 22,550 2,944 2,509 2,944 2,759 22,550 22,600 2,951 2,516 2,951 2,766 22,600 22,650 2,959 2,524 2,959 2,774 22,650 22,700 2,966 2,531 2,966 2,781 22,700 22,750 2,974 2,539 2,974 2,789 22,750 22,800 2,981 2,546 2,981 2,796 22,800 22,850 2,989 2,554 2,989 2,804 22,850 22,900 2,996 2,561 2,996 2,811 22,900 22,950 3,004 2,569 3,004 2,819 22,950 23,000 3,011 2,576 3,011 2,826

23,000 23,000 23,050 3,019 2,584 3,019 2,834 23,050 23,100 3,026 2,591 3,026 2,841 23,100 23,150 3,034 2,599 3,034 2,849 23,150 23,200 3,041 2,606 3,041 2,856 23,200 23,250 3,049 2,614 3,049 2,864 23,250 23,300 3,056 2,621 3,056 2,871 23,300 23,350 3,064 2,629 3,064 2,879 23,350 23,400 3,071 2,636 3,071 2,886 23,400 23,450 3,079 2,644 3,079 2,894 23,450 23,500 3,086 2,651 3,086 2,901 23,500 23,550 3,094 2,659 3,094 2,909 23,550 23,600 3,101 2,666 3,101 2,916 23,600 23,650 3,109 2,674 3,109 2,924 23,650 23,700 3,116 2,681 3,116 2,931 23,700 23,750 3,124 2,689 3,124 2,939 23,750 23,800 3,131 2,696 3,131 2,946 23,800 23,850 3,139 2,704 3,139 2,954 23,850 23,900 3,146 2,711 3,146 2,961 23,900 23,950 3,154 2,719 3,154 2,969 23,950 24,000 3,161 2,726 3,161 2,976

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 24,000

24,000 24,050 3,169 2,734 3,169 2,984 24,050 24,100 3,176 2,741 3,176 2,991 24,100 24,150 3,184 2,749 3,184 2,999 24,150 24,200 3,191 2,756 3,191 3,006 24,200 24,250 3,199 2,764 3,199 3,014 24,250 24,300 3,206 2,771 3,206 3,021 24,300 24,350 3,214 2,779 3,214 3,029 24,350 24,400 3,221 2,786 3,221 3,036 24,400 24,450 3,229 2,794 3,229 3,044 24,450 24,500 3,236 2,801 3,236 3,051 24,500 24,550 3,244 2,809 3,244 3,059 24,550 24,600 3,251 2,816 3,251 3,066 24,600 24,650 3,259 2,824 3,259 3,074 24,650 24,700 3,266 2,831 3,266 3,081 24,700 24,750 3,274 2,839 3,274 3,089 24,750 24,800 3,281 2,846 3,281 3,096 24,800 24,850 3,289 2,854 3,289 3,104 24,850 24,900 3,296 2,861 3,296 3,111 24,900 24,950 3,304 2,869 3,304 3,119 24,950 25,000 3,311 2,876 3,311 3,126

25,000 25,000 25,050 3,319 2,884 3,319 3,134 25,050 25,100 3,326 2,891 3,326 3,141 25,100 25,150 3,334 2,899 3,334 3,149 25,150 25,200 3,341 2,906 3,341 3,156 25,200 25,250 3,349 2,914 3,349 3,164 25,250 25,300 3,356 2,921 3,356 3,171 25,300 25,350 3,364 2,929 3,364 3,179 25,350 25,400 3,371 2,936 3,371 3,186 25,400 25,450 3,379 2,944 3,379 3,194 25,450 25,500 3,386 2,951 3,386 3,201 25,500 25,550 3,394 2,959 3,394 3,209 25,550 25,600 3,401 2,966 3,401 3,216 25,600 25,650 3,409 2,974 3,409 3,224 25,650 25,700 3,416 2,981 3,416 3,231 25,700 25,750 3,424 2,989 3,424 3,239 25,750 25,800 3,431 2,996 3,431 3,246 25,800 25,850 3,439 3,004 3,439 3,254 25,850 25,900 3,446 3,011 3,446 3,261 25,900 25,950 3,454 3,019 3,454 3,269 25,950 26,000 3,461 3,026 3,461 3,276

26,000 26,000 26,050 3,469 3,034 3,469 3,284 26,050 26,100 3,476 3,041 3,476 3,291 26,100 26,150 3,484 3,049 3,484 3,299 26,150 26,200 3,491 3,056 3,491 3,306 26,200 26,250 3,499 3,064 3,499 3,314 26,250 26,300 3,506 3,071 3,506 3,321 26,300 26,350 3,514 3,079 3,514 3,329 26,350 26,400 3,521 3,086 3,521 3,336 26,400 26,450 3,529 3,094 3,529 3,344 26,450 26,500 3,536 3,101 3,536 3,351 26,500 26,550 3,544 3,109 3,544 3,359 26,550 26,600 3,551 3,116 3,551 3,366 26,600 26,650 3,559 3,124 3,559 3,374 26,650 26,700 3,566 3,131 3,566 3,381 26,700 26,750 3,574 3,139 3,574 3,389 26,750 26,800 3,581 3,146 3,581 3,396 26,800 26,850 3,589 3,154 3,589 3,404 26,850 26,900 3,596 3,161 3,596 3,411 26,900 26,950 3,604 3,169 3,604 3,419 26,950 27,000 3,611 3,176 3,611 3,426

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 27,000

27,000 27,050 3,619 3,184 3,619 3,434 27,050 27,100 3,626 3,191 3,626 3,441 27,100 27,150 3,634 3,199 3,634 3,449 27,150 27,200 3,641 3,206 3,641 3,456 27,200 27,250 3,649 3,214 3,649 3,464 27,250 27,300 3,656 3,221 3,656 3,471 27,300 27,350 3,664 3,229 3,664 3,479 27,350 27,400 3,671 3,236 3,671 3,486 27,400 27,450 3,679 3,244 3,679 3,494 27,450 27,500 3,686 3,251 3,686 3,501 27,500 27,550 3,694 3,259 3,694 3,509 27,550 27,600 3,701 3,266 3,701 3,516 27,600 27,650 3,709 3,274 3,709 3,524 27,650 27,700 3,716 3,281 3,716 3,531 27,700 27,750 3,724 3,289 3,724 3,539 27,750 27,800 3,731 3,296 3,731 3,546 27,800 27,850 3,739 3,304 3,739 3,554 27,850 27,900 3,746 3,311 3,746 3,561 27,900 27,950 3,754 3,319 3,754 3,569 27,950 28,000 3,761 3,326 3,761 3,576

28,000 28,000 28,050 3,769 3,334 3,769 3,584 28,050 28,100 3,776 3,341 3,776 3,591 28,100 28,150 3,784 3,349 3,784 3,599 28,150 28,200 3,791 3,356 3,791 3,606 28,200 28,250 3,799 3,364 3,799 3,614 28,250 28,300 3,806 3,371 3,806 3,621 28,300 28,350 3,814 3,379 3,814 3,629 28,350 28,400 3,821 3,386 3,821 3,636 28,400 28,450 3,829 3,394 3,829 3,644 28,450 28,500 3,836 3,401 3,836 3,651 28,500 28,550 3,844 3,409 3,844 3,659 28,550 28,600 3,851 3,416 3,851 3,666 28,600 28,650 3,859 3,424 3,859 3,674 28,650 28,700 3,866 3,431 3,866 3,681 28,700 28,750 3,874 3,439 3,874 3,689 28,750 28,800 3,881 3,446 3,881 3,696 28,800 28,850 3,889 3,454 3,889 3,704 28,850 28,900 3,896 3,461 3,896 3,711 28,900 28,950 3,904 3,469 3,904 3,719 28,950 29,000 3,911 3,476 3,911 3,726

29,000 29,000 29,050 3,919 3,484 3,919 3,734 29,050 29,100 3,926 3,491 3,926 3,741 29,100 29,150 3,934 3,499 3,934 3,749 29,150 29,200 3,941 3,506 3,941 3,756 29,200 29,250 3,949 3,514 3,949 3,764 29,250 29,300 3,956 3,521 3,956 3,771 29,300 29,350 3,964 3,529 3,964 3,779 29,350 29,400 3,971 3,536 3,971 3,786 29,400 29,450 3,979 3,544 3,979 3,794 29,450 29,500 3,986 3,551 3,986 3,801 29,500 29,550 3,994 3,559 3,994 3,809 29,550 29,600 4,001 3,566 4,001 3,816 29,600 29,650 4,009 3,574 4,009 3,824 29,650 29,700 4,016 3,581 4,016 3,831 29,700 29,750 4,024 3,589 4,024 3,839 29,750 29,800 4,031 3,596 4,031 3,846 29,800 29,850 4,039 3,604 4,039 3,854 29,850 29,900 4,046 3,611 4,046 3,861 29,900 29,950 4,054 3,619 4,054 3,869 29,950 30,000 4,061 3,626 4,061 3,876

(Continued)

*This column must also be used by a qualifying widow(er).

Need more information or forms? Visit IRS.gov. -82-

Page 83 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

2012 Tax Table—Continued If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 30,000

30,000 30,050 4,069 3,634 4,069 3,884 30,050 30,100 4,076 3,641 4,076 3,891 30,100 30,150 4,084 3,649 4,084 3,899 30,150 30,200 4,091 3,656 4,091 3,906 30,200 30,250 4,099 3,664 4,099 3,914 30,250 30,300 4,106 3,671 4,106 3,921 30,300 30,350 4,114 3,679 4,114 3,929 30,350 30,400 4,121 3,686 4,121 3,936 30,400 30,450 4,129 3,694 4,129 3,944 30,450 30,500 4,136 3,701 4,136 3,951 30,500 30,550 4,144 3,709 4,144 3,959 30,550 30,600 4,151 3,716 4,151 3,966 30,600 30,650 4,159 3,724 4,159 3,974 30,650 30,700 4,166 3,731 4,166 3,981 30,700 30,750 4,174 3,739 4,174 3,989 30,750 30,800 4,181 3,746 4,181 3,996 30,800 30,850 4,189 3,754 4,189 4,004 30,850 30,900 4,196 3,761 4,196 4,011 30,900 30,950 4,204 3,769 4,204 4,019 30,950 31,000 4,211 3,776 4,211 4,026

31,000 31,000 31,050 4,219 3,784 4,219 4,034 31,050 31,100 4,226 3,791 4,226 4,041 31,100 31,150 4,234 3,799 4,234 4,049 31,150 31,200 4,241 3,806 4,241 4,056 31,200 31,250 4,249 3,814 4,249 4,064 31,250 31,300 4,256 3,821 4,256 4,071 31,300 31,350 4,264 3,829 4,264 4,079 31,350 31,400 4,271 3,836 4,271 4,086 31,400 31,450 4,279 3,844 4,279 4,094 31,450 31,500 4,286 3,851 4,286 4,101 31,500 31,550 4,294 3,859 4,294 4,109 31,550 31,600 4,301 3,866 4,301 4,116 31,600 31,650 4,309 3,874 4,309 4,124 31,650 31,700 4,316 3,881 4,316 4,131 31,700 31,750 4,324 3,889 4,324 4,139 31,750 31,800 4,331 3,896 4,331 4,146 31,800 31,850 4,339 3,904 4,339 4,154 31,850 31,900 4,346 3,911 4,346 4,161 31,900 31,950 4,354 3,919 4,354 4,169 31,950 32,000 4,361 3,926 4,361 4,176

32,000 32,000 32,050 4,369 3,934 4,369 4,184 32,050 32,100 4,376 3,941 4,376 4,191 32,100 32,150 4,384 3,949 4,384 4,199 32,150 32,200 4,391 3,956 4,391 4,206 32,200 32,250 4,399 3,964 4,399 4,214 32,250 32,300 4,406 3,971 4,406 4,221 32,300 32,350 4,414 3,979 4,414 4,229 32,350 32,400 4,421 3,986 4,421 4,236 32,400 32,450 4,429 3,994 4,429 4,244 32,450 32,500 4,436 4,001 4,436 4,251 32,500 32,550 4,444 4,009 4,444 4,259 32,550 32,600 4,451 4,016 4,451 4,266 32,600 32,650 4,459 4,024 4,459 4,274 32,650 32,700 4,466 4,031 4,466 4,281 32,700 32,750 4,474 4,039 4,474 4,289 32,750 32,800 4,481 4,046 4,481 4,296 32,800 32,850 4,489 4,054 4,489 4,304 32,850 32,900 4,496 4,061 4,496 4,311 32,900 32,950 4,504 4,069 4,504 4,319 32,950 33,000 4,511 4,076 4,511 4,326

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 33,000

33,000 33,050 4,519 4,084 4,519 4,334 33,050 33,100 4,526 4,091 4,526 4,341 33,100 33,150 4,534 4,099 4,534 4,349 33,150 33,200 4,541 4,106 4,541 4,356 33,200 33,250 4,549 4,114 4,549 4,364 33,250 33,300 4,556 4,121 4,556 4,371 33,300 33,350 4,564 4,129 4,564 4,379 33,350 33,400 4,571 4,136 4,571 4,386 33,400 33,450 4,579 4,144 4,579 4,394 33,450 33,500 4,586 4,151 4,586 4,401 33,500 33,550 4,594 4,159 4,594 4,409 33,550 33,600 4,601 4,166 4,601 4,416 33,600 33,650 4,609 4,174 4,609 4,424 33,650 33,700 4,616 4,181 4,616 4,431 33,700 33,750 4,624 4,189 4,624 4,439 33,750 33,800 4,631 4,196 4,631 4,446 33,800 33,850 4,639 4,204 4,639 4,454 33,850 33,900 4,646 4,211 4,646 4,461 33,900 33,950 4,654 4,219 4,654 4,469 33,950 34,000 4,661 4,226 4,661 4,476

34,000 34,000 34,050 4,669 4,234 4,669 4,484 34,050 34,100 4,676 4,241 4,676 4,491 34,100 34,150 4,684 4,249 4,684 4,499 34,150 34,200 4,691 4,256 4,691 4,506 34,200 34,250 4,699 4,264 4,699 4,514 34,250 34,300 4,706 4,271 4,706 4,521 34,300 34,350 4,714 4,279 4,714 4,529 34,350 34,400 4,721 4,286 4,721 4,536 34,400 34,450 4,729 4,294 4,729 4,544 34,450 34,500 4,736 4,301 4,736 4,551 34,500 34,550 4,744 4,309 4,744 4,559 34,550 34,600 4,751 4,316 4,751 4,566 34,600 34,650 4,759 4,324 4,759 4,574 34,650 34,700 4,766 4,331 4,766 4,581 34,700 34,750 4,774 4,339 4,774 4,589 34,750 34,800 4,781 4,346 4,781 4,596 34,800 34,850 4,789 4,354 4,789 4,604 34,850 34,900 4,796 4,361 4,796 4,611 34,900 34,950 4,804 4,369 4,804 4,619 34,950 35,000 4,811 4,376 4,811 4,626

35,000 35,000 35,050 4,819 4,384 4,819 4,634 35,050 35,100 4,826 4,391 4,826 4,641 35,100 35,150 4,834 4,399 4,834 4,649 35,150 35,200 4,841 4,406 4,841 4,656 35,200 35,250 4,849 4,414 4,849 4,664 35,250 35,300 4,856 4,421 4,856 4,671 35,300 35,350 4,864 4,429 4,864 4,679 35,350 35,400 4,874 4,436 4,874 4,686 35,400 35,450 4,886 4,444 4,886 4,694 35,450 35,500 4,899 4,451 4,899 4,701 35,500 35,550 4,911 4,459 4,911 4,709 35,550 35,600 4,924 4,466 4,924 4,716 35,600 35,650 4,936 4,474 4,936 4,724 35,650 35,700 4,949 4,481 4,949 4,731 35,700 35,750 4,961 4,489 4,961 4,739 35,750 35,800 4,974 4,496 4,974 4,746 35,800 35,850 4,986 4,504 4,986 4,754 35,850 35,900 4,999 4,511 4,999 4,761 35,900 35,950 5,011 4,519 5,011 4,769 35,950 36,000 5,024 4,526 5,024 4,776

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 36,000

36,000 36,050 5,036 4,534 5,036 4,784 36,050 36,100 5,049 4,541 5,049 4,791 36,100 36,150 5,061 4,549 5,061 4,799 36,150 36,200 5,074 4,556 5,074 4,806 36,200 36,250 5,086 4,564 5,086 4,814 36,250 36,300 5,099 4,571 5,099 4,821 36,300 36,350 5,111 4,579 5,111 4,829 36,350 36,400 5,124 4,586 5,124 4,836 36,400 36,450 5,136 4,594 5,136 4,844 36,450 36,500 5,149 4,601 5,149 4,851 36,500 36,550 5,161 4,609 5,161 4,859 36,550 36,600 5,174 4,616 5,174 4,866 36,600 36,650 5,186 4,624 5,186 4,874 36,650 36,700 5,199 4,631 5,199 4,881 36,700 36,750 5,211 4,639 5,211 4,889 36,750 36,800 5,224 4,646 5,224 4,896 36,800 36,850 5,236 4,654 5,236 4,904 36,850 36,900 5,249 4,661 5,249 4,911 36,900 36,950 5,261 4,669 5,261 4,919 36,950 37,000 5,274 4,676 5,274 4,926

37,000 37,000 37,050 5,286 4,684 5,286 4,934 37,050 37,100 5,299 4,691 5,299 4,941 37,100 37,150 5,311 4,699 5,311 4,949 37,150 37,200 5,324 4,706 5,324 4,956 37,200 37,250 5,336 4,714 5,336 4,964 37,250 37,300 5,349 4,721 5,349 4,971 37,300 37,350 5,361 4,729 5,361 4,979 37,350 37,400 5,374 4,736 5,374 4,986 37,400 37,450 5,386 4,744 5,386 4,994 37,450 37,500 5,399 4,751 5,399 5,001 37,500 37,550 5,411 4,759 5,411 5,009 37,550 37,600 5,424 4,766 5,424 5,016 37,600 37,650 5,436 4,774 5,436 5,024 37,650 37,700 5,449 4,781 5,449 5,031 37,700 37,750 5,461 4,789 5,461 5,039 37,750 37,800 5,474 4,796 5,474 5,046 37,800 37,850 5,486 4,804 5,486 5,054 37,850 37,900 5,499 4,811 5,499 5,061 37,900 37,950 5,511 4,819 5,511 5,069 37,950 38,000 5,524 4,826 5,524 5,076

38,000 38,000 38,050 5,536 4,834 5,536 5,084 38,050 38,100 5,549 4,841 5,549 5,091 38,100 38,150 5,561 4,849 5,561 5,099 38,150 38,200 5,574 4,856 5,574 5,106 38,200 38,250 5,586 4,864 5,586 5,114 38,250 38,300 5,599 4,871 5,599 5,121 38,300 38,350 5,611 4,879 5,611 5,129 38,350 38,400 5,624 4,886 5,624 5,136 38,400 38,450 5,636 4,894 5,636 5,144 38,450 38,500 5,649 4,901 5,649 5,151 38,500 38,550 5,661 4,909 5,661 5,159 38,550 38,600 5,674 4,916 5,674 5,166 38,600 38,650 5,686 4,924 5,686 5,174 38,650 38,700 5,699 4,931 5,699 5,181 38,700 38,750 5,711 4,939 5,711 5,189 38,750 38,800 5,724 4,946 5,724 5,196 38,800 38,850 5,736 4,954 5,736 5,204 38,850 38,900 5,749 4,961 5,749 5,211 38,900 38,950 5,761 4,969 5,761 5,219 38,950 39,000 5,774 4,976 5,774 5,226

(Continued)

*This column must also be used by a qualifying widow(er).

-83- Need more information or forms? Visit IRS.gov.

Page 84 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

2012 Tax Table—Continued If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 39,000

39,000 39,050 5,786 4,984 5,786 5,234 39,050 39,100 5,799 4,991 5,799 5,241 39,100 39,150 5,811 4,999 5,811 5,249 39,150 39,200 5,824 5,006 5,824 5,256 39,200 39,250 5,836 5,014 5,836 5,264 39,250 39,300 5,849 5,021 5,849 5,271 39,300 39,350 5,861 5,029 5,861 5,279 39,350 39,400 5,874 5,036 5,874 5,286 39,400 39,450 5,886 5,044 5,886 5,294 39,450 39,500 5,899 5,051 5,899 5,301 39,500 39,550 5,911 5,059 5,911 5,309 39,550 39,600 5,924 5,066 5,924 5,316 39,600 39,650 5,936 5,074 5,936 5,324 39,650 39,700 5,949 5,081 5,949 5,331 39,700 39,750 5,961 5,089 5,961 5,339 39,750 39,800 5,974 5,096 5,974 5,346 39,800 39,850 5,986 5,104 5,986 5,354 39,850 39,900 5,999 5,111 5,999 5,361 39,900 39,950 6,011 5,119 6,011 5,369 39,950 40,000 6,024 5,126 6,024 5,376

40,000 40,000 40,050 6,036 5,134 6,036 5,384 40,050 40,100 6,049 5,141 6,049 5,391 40,100 40,150 6,061 5,149 6,061 5,399 40,150 40,200 6,074 5,156 6,074 5,406 40,200 40,250 6,086 5,164 6,086 5,414 40,250 40,300 6,099 5,171 6,099 5,421 40,300 40,350 6,111 5,179 6,111 5,429 40,350 40,400 6,124 5,186 6,124 5,436 40,400 40,450 6,136 5,194 6,136 5,444 40,450 40,500 6,149 5,201 6,149 5,451 40,500 40,550 6,161 5,209 6,161 5,459 40,550 40,600 6,174 5,216 6,174 5,466 40,600 40,650 6,186 5,224 6,186 5,474 40,650 40,700 6,199 5,231 6,199 5,481 40,700 40,750 6,211 5,239 6,211 5,489 40,750 40,800 6,224 5,246 6,224 5,496 40,800 40,850 6,236 5,254 6,236 5,504 40,850 40,900 6,249 5,261 6,249 5,511 40,900 40,950 6,261 5,269 6,261 5,519 40,950 41,000 6,274 5,276 6,274 5,526

41,000 41,000 41,050 6,286 5,284 6,286 5,534 41,050 41,100 6,299 5,291 6,299 5,541 41,100 41,150 6,311 5,299 6,311 5,549 41,150 41,200 6,324 5,306 6,324 5,556 41,200 41,250 6,336 5,314 6,336 5,564 41,250 41,300 6,349 5,321 6,349 5,571 41,300 41,350 6,361 5,329 6,361 5,579 41,350 41,400 6,374 5,336 6,374 5,586 41,400 41,450 6,386 5,344 6,386 5,594 41,450 41,500 6,399 5,351 6,399 5,601 41,500 41,550 6,411 5,359 6,411 5,609 41,550 41,600 6,424 5,366 6,424 5,616 41,600 41,650 6,436 5,374 6,436 5,624 41,650 41,700 6,449 5,381 6,449 5,631 41,700 41,750 6,461 5,389 6,461 5,639 41,750 41,800 6,474 5,396 6,474 5,646 41,800 41,850 6,486 5,404 6,486 5,654 41,850 41,900 6,499 5,411 6,499 5,661 41,900 41,950 6,511 5,419 6,511 5,669 41,950 42,000 6,524 5,426 6,524 5,676

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 42,000

42,000 42,050 6,536 5,434 6,536 5,684 42,050 42,100 6,549 5,441 6,549 5,691 42,100 42,150 6,561 5,449 6,561 5,699 42,150 42,200 6,574 5,456 6,574 5,706 42,200 42,250 6,586 5,464 6,586 5,714 42,250 42,300 6,599 5,471 6,599 5,721 42,300 42,350 6,611 5,479 6,611 5,729 42,350 42,400 6,624 5,486 6,624 5,736 42,400 42,450 6,636 5,494 6,636 5,744 42,450 42,500 6,649 5,501 6,649 5,751 42,500 42,550 6,661 5,509 6,661 5,759 42,550 42,600 6,674 5,516 6,674 5,766 42,600 42,650 6,686 5,524 6,686 5,774 42,650 42,700 6,699 5,531 6,699 5,781 42,700 42,750 6,711 5,539 6,711 5,789 42,750 42,800 6,724 5,546 6,724 5,796 42,800 42,850 6,736 5,554 6,736 5,804 42,850 42,900 6,749 5,561 6,749 5,811 42,900 42,950 6,761 5,569 6,761 5,819 42,950 43,000 6,774 5,576 6,774 5,826

43,000 43,000 43,050 6,786 5,584 6,786 5,834 43,050 43,100 6,799 5,591 6,799 5,841 43,100 43,150 6,811 5,599 6,811 5,849 43,150 43,200 6,824 5,606 6,824 5,856 43,200 43,250 6,836 5,614 6,836 5,864 43,250 43,300 6,849 5,621 6,849 5,871 43,300 43,350 6,861 5,629 6,861 5,879 43,350 43,400 6,874 5,636 6,874 5,886 43,400 43,450 6,886 5,644 6,886 5,894 43,450 43,500 6,899 5,651 6,899 5,901 43,500 43,550 6,911 5,659 6,911 5,909 43,550 43,600 6,924 5,666 6,924 5,916 43,600 43,650 6,936 5,674 6,936 5,924 43,650 43,700 6,949 5,681 6,949 5,931 43,700 43,750 6,961 5,689 6,961 5,939 43,750 43,800 6,974 5,696 6,974 5,946 43,800 43,850 6,986 5,704 6,986 5,954 43,850 43,900 6,999 5,711 6,999 5,961 43,900 43,950 7,011 5,719 7,011 5,969 43,950 44,000 7,024 5,726 7,024 5,976

44,000 44,000 44,050 7,036 5,734 7,036 5,984 44,050 44,100 7,049 5,741 7,049 5,991 44,100 44,150 7,061 5,749 7,061 5,999 44,150 44,200 7,074 5,756 7,074 6,006 44,200 44,250 7,086 5,764 7,086 6,014 44,250 44,300 7,099 5,771 7,099 6,021 44,300 44,350 7,111 5,779 7,111 6,029 44,350 44,400 7,124 5,786 7,124 6,036 44,400 44,450 7,136 5,794 7,136 6,044 44,450 44,500 7,149 5,801 7,149 6,051 44,500 44,550 7,161 5,809 7,161 6,059 44,550 44,600 7,174 5,816 7,174 6,066 44,600 44,650 7,186 5,824 7,186 6,074 44,650 44,700 7,199 5,831 7,199 6,081 44,700 44,750 7,211 5,839 7,211 6,089 44,750 44,800 7,224 5,846 7,224 6,096 44,800 44,850 7,236 5,854 7,236 6,104 44,850 44,900 7,249 5,861 7,249 6,111 44,900 44,950 7,261 5,869 7,261 6,119 44,950 45,000 7,274 5,876 7,274 6,126

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 45,000

45,000 45,050 7,286 5,884 7,286 6,134 45,050 45,100 7,299 5,891 7,299 6,141 45,100 45,150 7,311 5,899 7,311 6,149 45,150 45,200 7,324 5,906 7,324 6,156 45,200 45,250 7,336 5,914 7,336 6,164 45,250 45,300 7,349 5,921 7,349 6,171 45,300 45,350 7,361 5,929 7,361 6,179 45,350 45,400 7,374 5,936 7,374 6,186 45,400 45,450 7,386 5,944 7,386 6,194 45,450 45,500 7,399 5,951 7,399 6,201 45,500 45,550 7,411 5,959 7,411 6,209 45,550 45,600 7,424 5,966 7,424 6,216 45,600 45,650 7,436 5,974 7,436 6,224 45,650 45,700 7,449 5,981 7,449 6,231 45,700 45,750 7,461 5,989 7,461 6,239 45,750 45,800 7,474 5,996 7,474 6,246 45,800 45,850 7,486 6,004 7,486 6,254 45,850 45,900 7,499 6,011 7,499 6,261 45,900 45,950 7,511 6,019 7,511 6,269 45,950 46,000 7,524 6,026 7,524 6,276

46,000 46,000 46,050 7,536 6,034 7,536 6,284 46,050 46,100 7,549 6,041 7,549 6,291 46,100 46,150 7,561 6,049 7,561 6,299 46,150 46,200 7,574 6,056 7,574 6,306 46,200 46,250 7,586 6,064 7,586 6,314 46,250 46,300 7,599 6,071 7,599 6,321 46,300 46,350 7,611 6,079 7,611 6,329 46,350 46,400 7,624 6,086 7,624 6,336 46,400 46,450 7,636 6,094 7,636 6,344 46,450 46,500 7,649 6,101 7,649 6,351 46,500 46,550 7,661 6,109 7,661 6,359 46,550 46,600 7,674 6,116 7,674 6,366 46,600 46,650 7,686 6,124 7,686 6,374 46,650 46,700 7,699 6,131 7,699 6,381 46,700 46,750 7,711 6,139 7,711 6,389 46,750 46,800 7,724 6,146 7,724 6,396 46,800 46,850 7,736 6,154 7,736 6,404 46,850 46,900 7,749 6,161 7,749 6,411 46,900 46,950 7,761 6,169 7,761 6,419 46,950 47,000 7,774 6,176 7,774 6,426

47,000 47,000 47,050 7,786 6,184 7,786 6,434 47,050 47,100 7,799 6,191 7,799 6,441 47,100 47,150 7,811 6,199 7,811 6,449 47,150 47,200 7,824 6,206 7,824 6,456 47,200 47,250 7,836 6,214 7,836 6,464 47,250 47,300 7,849 6,221 7,849 6,471 47,300 47,350 7,861 6,229 7,861 6,479 47,350 47,400 7,874 6,236 7,874 6,489 47,400 47,450 7,886 6,244 7,886 6,501 47,450 47,500 7,899 6,251 7,899 6,514 47,500 47,550 7,911 6,259 7,911 6,526 47,550 47,600 7,924 6,266 7,924 6,539 47,600 47,650 7,936 6,274 7,936 6,551 47,650 47,700 7,949 6,281 7,949 6,564 47,700 47,750 7,961 6,289 7,961 6,576 47,750 47,800 7,974 6,296 7,974 6,589 47,800 47,850 7,986 6,304 7,986 6,601 47,850 47,900 7,999 6,311 7,999 6,614 47,900 47,950 8,011 6,319 8,011 6,626 47,950 48,000 8,024 6,326 8,024 6,639

(Continued)

*This column must also be used by a qualifying widow(er).

Need more information or forms? Visit IRS.gov. -84-

Page 85 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

2012 Tax Table—Continued If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 48,000

48,000 48,050 8,036 6,334 8,036 6,651 48,050 48,100 8,049 6,341 8,049 6,664 48,100 48,150 8,061 6,349 8,061 6,676 48,150 48,200 8,074 6,356 8,074 6,689 48,200 48,250 8,086 6,364 8,086 6,701 48,250 48,300 8,099 6,371 8,099 6,714 48,300 48,350 8,111 6,379 8,111 6,726 48,350 48,400 8,124 6,386 8,124 6,739 48,400 48,450 8,136 6,394 8,136 6,751 48,450 48,500 8,149 6,401 8,149 6,764 48,500 48,550 8,161 6,409 8,161 6,776 48,550 48,600 8,174 6,416 8,174 6,789 48,600 48,650 8,186 6,424 8,186 6,801 48,650 48,700 8,199 6,431 8,199 6,814 48,700 48,750 8,211 6,439 8,211 6,826 48,750 48,800 8,224 6,446 8,224 6,839 48,800 48,850 8,236 6,454 8,236 6,851 48,850 48,900 8,249 6,461 8,249 6,864 48,900 48,950 8,261 6,469 8,261 6,876 48,950 49,000 8,274 6,476 8,274 6,889

49,000 49,000 49,050 8,286 6,484 8,286 6,901 49,050 49,100 8,299 6,491 8,299 6,914 49,100 49,150 8,311 6,499 8,311 6,926 49,150 49,200 8,324 6,506 8,324 6,939 49,200 49,250 8,336 6,514 8,336 6,951 49,250 49,300 8,349 6,521 8,349 6,964 49,300 49,350 8,361 6,529 8,361 6,976 49,350 49,400 8,374 6,536 8,374 6,989 49,400 49,450 8,386 6,544 8,386 7,001 49,450 49,500 8,399 6,551 8,399 7,014 49,500 49,550 8,411 6,559 8,411 7,026 49,550 49,600 8,424 6,566 8,424 7,039 49,600 49,650 8,436 6,574 8,436 7,051 49,650 49,700 8,449 6,581 8,449 7,064 49,700 49,750 8,461 6,589 8,461 7,076 49,750 49,800 8,474 6,596 8,474 7,089 49,800 49,850 8,486 6,604 8,486 7,101 49,850 49,900 8,499 6,611 8,499 7,114 49,900 49,950 8,511 6,619 8,511 7,126 49,950 50,000 8,524 6,626 8,524 7,139

50,000 50,000 50,050 8,536 6,634 8,536 7,151 50,050 50,100 8,549 6,641 8,549 7,164 50,100 50,150 8,561 6,649 8,561 7,176 50,150 50,200 8,574 6,656 8,574 7,189 50,200 50,250 8,586 6,664 8,586 7,201 50,250 50,300 8,599 6,671 8,599 7,214 50,300 50,350 8,611 6,679 8,611 7,226 50,350 50,400 8,624 6,686 8,624 7,239 50,400 50,450 8,636 6,694 8,636 7,251 50,450 50,500 8,649 6,701 8,649 7,264 50,500 50,550 8,661 6,709 8,661 7,276 50,550 50,600 8,674 6,716 8,674 7,289 50,600 50,650 8,686 6,724 8,686 7,301 50,650 50,700 8,699 6,731 8,699 7,314 50,700 50,750 8,711 6,739 8,711 7,326 50,750 50,800 8,724 6,746 8,724 7,339 50,800 50,850 8,736 6,754 8,736 7,351 50,850 50,900 8,749 6,761 8,749 7,364 50,900 50,950 8,761 6,769 8,761 7,376 50,950 51,000 8,774 6,776 8,774 7,389

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 51,000

51,000 51,050 8,786 6,784 8,786 7,401 51,050 51,100 8,799 6,791 8,799 7,414 51,100 51,150 8,811 6,799 8,811 7,426 51,150 51,200 8,824 6,806 8,824 7,439 51,200 51,250 8,836 6,814 8,836 7,451 51,250 51,300 8,849 6,821 8,849 7,464 51,300 51,350 8,861 6,829 8,861 7,476 51,350 51,400 8,874 6,836 8,874 7,489 51,400 51,450 8,886 6,844 8,886 7,501 51,450 51,500 8,899 6,851 8,899 7,514 51,500 51,550 8,911 6,859 8,911 7,526 51,550 51,600 8,924 6,866 8,924 7,539 51,600 51,650 8,936 6,874 8,936 7,551 51,650 51,700 8,949 6,881 8,949 7,564 51,700 51,750 8,961 6,889 8,961 7,576 51,750 51,800 8,974 6,896 8,974 7,589 51,800 51,850 8,986 6,904 8,986 7,601 51,850 51,900 8,999 6,911 8,999 7,614 51,900 51,950 9,011 6,919 9,011 7,626 51,950 52,000 9,024 6,926 9,024 7,639

52,000 52,000 52,050 9,036 6,934 9,036 7,651 52,050 52,100 9,049 6,941 9,049 7,664 52,100 52,150 9,061 6,949 9,061 7,676 52,150 52,200 9,074 6,956 9,074 7,689 52,200 52,250 9,086 6,964 9,086 7,701 52,250 52,300 9,099 6,971 9,099 7,714 52,300 52,350 9,111 6,979 9,111 7,726 52,350 52,400 9,124 6,986 9,124 7,739 52,400 52,450 9,136 6,994 9,136 7,751 52,450 52,500 9,149 7,001 9,149 7,764 52,500 52,550 9,161 7,009 9,161 7,776 52,550 52,600 9,174 7,016 9,174 7,789 52,600 52,650 9,186 7,024 9,186 7,801 52,650 52,700 9,199 7,031 9,199 7,814 52,700 52,750 9,211 7,039 9,211 7,826 52,750 52,800 9,224 7,046 9,224 7,839 52,800 52,850 9,236 7,054 9,236 7,851 52,850 52,900 9,249 7,061 9,249 7,864 52,900 52,950 9,261 7,069 9,261 7,876 52,950 53,000 9,274 7,076 9,274 7,889

53,000 53,000 53,050 9,286 7,084 9,286 7,901 53,050 53,100 9,299 7,091 9,299 7,914 53,100 53,150 9,311 7,099 9,311 7,926 53,150 53,200 9,324 7,106 9,324 7,939 53,200 53,250 9,336 7,114 9,336 7,951 53,250 53,300 9,349 7,121 9,349 7,964 53,300 53,350 9,361 7,129 9,361 7,976 53,350 53,400 9,374 7,136 9,374 7,989 53,400 53,450 9,386 7,144 9,386 8,001 53,450 53,500 9,399 7,151 9,399 8,014 53,500 53,550 9,411 7,159 9,411 8,026 53,550 53,600 9,424 7,166 9,424 8,039 53,600 53,650 9,436 7,174 9,436 8,051 53,650 53,700 9,449 7,181 9,449 8,064 53,700 53,750 9,461 7,189 9,461 8,076 53,750 53,800 9,474 7,196 9,474 8,089 53,800 53,850 9,486 7,204 9,486 8,101 53,850 53,900 9,499 7,211 9,499 8,114 53,900 53,950 9,511 7,219 9,511 8,126 53,950 54,000 9,524 7,226 9,524 8,139

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 54,000

54,000 54,050 9,536 7,234 9,536 8,151 54,050 54,100 9,549 7,241 9,549 8,164 54,100 54,150 9,561 7,249 9,561 8,176 54,150 54,200 9,574 7,256 9,574 8,189 54,200 54,250 9,586 7,264 9,586 8,201 54,250 54,300 9,599 7,271 9,599 8,214 54,300 54,350 9,611 7,279 9,611 8,226 54,350 54,400 9,624 7,286 9,624 8,239 54,400 54,450 9,636 7,294 9,636 8,251 54,450 54,500 9,649 7,301 9,649 8,264 54,500 54,550 9,661 7,309 9,661 8,276 54,550 54,600 9,674 7,316 9,674 8,289 54,600 54,650 9,686 7,324 9,686 8,301 54,650 54,700 9,699 7,331 9,699 8,314 54,700 54,750 9,711 7,339 9,711 8,326 54,750 54,800 9,724 7,346 9,724 8,339 54,800 54,850 9,736 7,354 9,736 8,351 54,850 54,900 9,749 7,361 9,749 8,364 54,900 54,950 9,761 7,369 9,761 8,376 54,950 55,000 9,774 7,376 9,774 8,389

55,000 55,000 55,050 9,786 7,384 9,786 8,401 55,050 55,100 9,799 7,391 9,799 8,414 55,100 55,150 9,811 7,399 9,811 8,426 55,150 55,200 9,824 7,406 9,824 8,439 55,200 55,250 9,836 7,414 9,836 8,451 55,250 55,300 9,849 7,421 9,849 8,464 55,300 55,350 9,861 7,429 9,861 8,476 55,350 55,400 9,874 7,436 9,874 8,489 55,400 55,450 9,886 7,444 9,886 8,501 55,450 55,500 9,899 7,451 9,899 8,514 55,500 55,550 9,911 7,459 9,911 8,526 55,550 55,600 9,924 7,466 9,924 8,539 55,600 55,650 9,936 7,474 9,936 8,551 55,650 55,700 9,949 7,481 9,949 8,564 55,700 55,750 9,961 7,489 9,961 8,576 55,750 55,800 9,974 7,496 9,974 8,589 55,800 55,850 9,986 7,504 9,986 8,601 55,850 55,900 9,999 7,511 9,999 8,614 55,900 55,950 10,011 7,519 10,011 8,626 55,950 56,000 10,024 7,526 10,024 8,639

56,000 56,000 56,050 10,036 7,534 10,036 8,651 56,050 56,100 10,049 7,541 10,049 8,664 56,100 56,150 10,061 7,549 10,061 8,676 56,150 56,200 10,074 7,556 10,074 8,689 56,200 56,250 10,086 7,564 10,086 8,701 56,250 56,300 10,099 7,571 10,099 8,714 56,300 56,350 10,111 7,579 10,111 8,726 56,350 56,400 10,124 7,586 10,124 8,739 56,400 56,450 10,136 7,594 10,136 8,751 56,450 56,500 10,149 7,601 10,149 8,764 56,500 56,550 10,161 7,609 10,161 8,776 56,550 56,600 10,174 7,616 10,174 8,789 56,600 56,650 10,186 7,624 10,186 8,801 56,650 56,700 10,199 7,631 10,199 8,814 56,700 56,750 10,211 7,639 10,211 8,826 56,750 56,800 10,224 7,646 10,224 8,839 56,800 56,850 10,236 7,654 10,236 8,851 56,850 56,900 10,249 7,661 10,249 8,864 56,900 56,950 10,261 7,669 10,261 8,876 56,950 57,000 10,274 7,676 10,274 8,889

(Continued)

*This column must also be used by a qualifying widow(er).

-85- Need more information or forms? Visit IRS.gov.

Page 86 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

2012 Tax Table—Continued If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 57,000

57,000 57,050 10,286 7,684 10,286 8,901 57,050 57,100 10,299 7,691 10,299 8,914 57,100 57,150 10,311 7,699 10,311 8,926 57,150 57,200 10,324 7,706 10,324 8,939 57,200 57,250 10,336 7,714 10,336 8,951 57,250 57,300 10,349 7,721 10,349 8,964 57,300 57,350 10,361 7,729 10,361 8,976 57,350 57,400 10,374 7,736 10,374 8,989 57,400 57,450 10,386 7,744 10,386 9,001 57,450 57,500 10,399 7,751 10,399 9,014 57,500 57,550 10,411 7,759 10,411 9,026 57,550 57,600 10,424 7,766 10,424 9,039 57,600 57,650 10,436 7,774 10,436 9,051 57,650 57,700 10,449 7,781 10,449 9,064 57,700 57,750 10,461 7,789 10,461 9,076 57,750 57,800 10,474 7,796 10,474 9,089 57,800 57,850 10,486 7,804 10,486 9,101 57,850 57,900 10,499 7,811 10,499 9,114 57,900 57,950 10,511 7,819 10,511 9,126 57,950 58,000 10,524 7,826 10,524 9,139

58,000 58,000 58,050 10,536 7,834 10,536 9,151 58,050 58,100 10,549 7,841 10,549 9,164 58,100 58,150 10,561 7,849 10,561 9,176 58,150 58,200 10,574 7,856 10,574 9,189 58,200 58,250 10,586 7,864 10,586 9,201 58,250 58,300 10,599 7,871 10,599 9,214 58,300 58,350 10,611 7,879 10,611 9,226 58,350 58,400 10,624 7,886 10,624 9,239 58,400 58,450 10,636 7,894 10,636 9,251 58,450 58,500 10,649 7,901 10,649 9,264 58,500 58,550 10,661 7,909 10,661 9,276 58,550 58,600 10,674 7,916 10,674 9,289 58,600 58,650 10,686 7,924 10,686 9,301 58,650 58,700 10,699 7,931 10,699 9,314 58,700 58,750 10,711 7,939 10,711 9,326 58,750 58,800 10,724 7,946 10,724 9,339 58,800 58,850 10,736 7,954 10,736 9,351 58,850 58,900 10,749 7,961 10,749 9,364 58,900 58,950 10,761 7,969 10,761 9,376 58,950 59,000 10,774 7,976 10,774 9,389

59,000 59,000 59,050 10,786 7,984 10,786 9,401 59,050 59,100 10,799 7,991 10,799 9,414 59,100 59,150 10,811 7,999 10,811 9,426 59,150 59,200 10,824 8,006 10,824 9,439 59,200 59,250 10,836 8,014 10,836 9,451 59,250 59,300 10,849 8,021 10,849 9,464 59,300 59,350 10,861 8,029 10,861 9,476 59,350 59,400 10,874 8,036 10,874 9,489 59,400 59,450 10,886 8,044 10,886 9,501 59,450 59,500 10,899 8,051 10,899 9,514 59,500 59,550 10,911 8,059 10,911 9,526 59,550 59,600 10,924 8,066 10,924 9,539 59,600 59,650 10,936 8,074 10,936 9,551 59,650 59,700 10,949 8,081 10,949 9,564 59,700 59,750 10,961 8,089 10,961 9,576 59,750 59,800 10,974 8,096 10,974 9,589 59,800 59,850 10,986 8,104 10,986 9,601 59,850 59,900 10,999 8,111 10,999 9,614 59,900 59,950 11,011 8,119 11,011 9,626 59,950 60,000 11,024 8,126 11,024 9,639

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 60,000

60,000 60,050 11,036 8,134 11,036 9,651 60,050 60,100 11,049 8,141 11,049 9,664 60,100 60,150 11,061 8,149 11,061 9,676 60,150 60,200 11,074 8,156 11,074 9,689 60,200 60,250 11,086 8,164 11,086 9,701 60,250 60,300 11,099 8,171 11,099 9,714 60,300 60,350 11,111 8,179 11,111 9,726 60,350 60,400 11,124 8,186 11,124 9,739 60,400 60,450 11,136 8,194 11,136 9,751 60,450 60,500 11,149 8,201 11,149 9,764 60,500 60,550 11,161 8,209 11,161 9,776 60,550 60,600 11,174 8,216 11,174 9,789 60,600 60,650 11,186 8,224 11,186 9,801 60,650 60,700 11,199 8,231 11,199 9,814 60,700 60,750 11,211 8,239 11,211 9,826 60,750 60,800 11,224 8,246 11,224 9,839 60,800 60,850 11,236 8,254 11,236 9,851 60,850 60,900 11,249 8,261 11,249 9,864 60,900 60,950 11,261 8,269 11,261 9,876 60,950 61,000 11,274 8,276 11,274 9,889

61,000 61,000 61,050 11,286 8,284 11,286 9,901 61,050 61,100 11,299 8,291 11,299 9,914 61,100 61,150 11,311 8,299 11,311 9,926 61,150 61,200 11,324 8,306 11,324 9,939 61,200 61,250 11,336 8,314 11,336 9,951 61,250 61,300 11,349 8,321 11,349 9,964 61,300 61,350 11,361 8,329 11,361 9,976 61,350 61,400 11,374 8,336 11,374 9,989 61,400 61,450 11,386 8,344 11,386 10,001 61,450 61,500 11,399 8,351 11,399 10,014 61,500 61,550 11,411 8,359 11,411 10,026 61,550 61,600 11,424 8,366 11,424 10,039 61,600 61,650 11,436 8,374 11,436 10,051 61,650 61,700 11,449 8,381 11,449 10,064 61,700 61,750 11,461 8,389 11,461 10,076 61,750 61,800 11,474 8,396 11,474 10,089 61,800 61,850 11,486 8,404 11,486 10,101 61,850 61,900 11,499 8,411 11,499 10,114 61,900 61,950 11,511 8,419 11,511 10,126 61,950 62,000 11,524 8,426 11,524 10,139

62,000 62,000 62,050 11,536 8,434 11,536 10,151 62,050 62,100 11,549 8,441 11,549 10,164 62,100 62,150 11,561 8,449 11,561 10,176 62,150 62,200 11,574 8,456 11,574 10,189 62,200 62,250 11,586 8,464 11,586 10,201 62,250 62,300 11,599 8,471 11,599 10,214 62,300 62,350 11,611 8,479 11,611 10,226 62,350 62,400 11,624 8,486 11,624 10,239 62,400 62,450 11,636 8,494 11,636 10,251 62,450 62,500 11,649 8,501 11,649 10,264 62,500 62,550 11,661 8,509 11,661 10,276 62,550 62,600 11,674 8,516 11,674 10,289 62,600 62,650 11,686 8,524 11,686 10,301 62,650 62,700 11,699 8,531 11,699 10,314 62,700 62,750 11,711 8,539 11,711 10,326 62,750 62,800 11,724 8,546 11,724 10,339 62,800 62,850 11,736 8,554 11,736 10,351 62,850 62,900 11,749 8,561 11,749 10,364 62,900 62,950 11,761 8,569 11,761 10,376 62,950 63,000 11,774 8,576 11,774 10,389

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 63,000

63,000 63,050 11,786 8,584 11,786 10,401 63,050 63,100 11,799 8,591 11,799 10,414 63,100 63,150 11,811 8,599 11,811 10,426 63,150 63,200 11,824 8,606 11,824 10,439 63,200 63,250 11,836 8,614 11,836 10,451 63,250 63,300 11,849 8,621 11,849 10,464 63,300 63,350 11,861 8,629 11,861 10,476 63,350 63,400 11,874 8,636 11,874 10,489 63,400 63,450 11,886 8,644 11,886 10,501 63,450 63,500 11,899 8,651 11,899 10,514 63,500 63,550 11,911 8,659 11,911 10,526 63,550 63,600 11,924 8,666 11,924 10,539 63,600 63,650 11,936 8,674 11,936 10,551 63,650 63,700 11,949 8,681 11,949 10,564 63,700 63,750 11,961 8,689 11,961 10,576 63,750 63,800 11,974 8,696 11,974 10,589 63,800 63,850 11,986 8,704 11,986 10,601 63,850 63,900 11,999 8,711 11,999 10,614 63,900 63,950 12,011 8,719 12,011 10,626 63,950 64,000 12,024 8,726 12,024 10,639

64,000 64,000 64,050 12,036 8,734 12,036 10,651 64,050 64,100 12,049 8,741 12,049 10,664 64,100 64,150 12,061 8,749 12,061 10,676 64,150 64,200 12,074 8,756 12,074 10,689 64,200 64,250 12,086 8,764 12,086 10,701 64,250 64,300 12,099 8,771 12,099 10,714 64,300 64,350 12,111 8,779 12,111 10,726 64,350 64,400 12,124 8,786 12,124 10,739 64,400 64,450 12,136 8,794 12,136 10,751 64,450 64,500 12,149 8,801 12,149 10,764 64,500 64,550 12,161 8,809 12,161 10,776 64,550 64,600 12,174 8,816 12,174 10,789 64,600 64,650 12,186 8,824 12,186 10,801 64,650 64,700 12,199 8,831 12,199 10,814 64,700 64,750 12,211 8,839 12,211 10,826 64,750 64,800 12,224 8,846 12,224 10,839 64,800 64,850 12,236 8,854 12,236 10,851 64,850 64,900 12,249 8,861 12,249 10,864 64,900 64,950 12,261 8,869 12,261 10,876 64,950 65,000 12,274 8,876 12,274 10,889

65,000 65,000 65,050 12,286 8,884 12,286 10,901 65,050 65,100 12,299 8,891 12,299 10,914 65,100 65,150 12,311 8,899 12,311 10,926 65,150 65,200 12,324 8,906 12,324 10,939 65,200 65,250 12,336 8,914 12,336 10,951 65,250 65,300 12,349 8,921 12,349 10,964 65,300 65,350 12,361 8,929 12,361 10,976 65,350 65,400 12,374 8,936 12,374 10,989 65,400 65,450 12,386 8,944 12,386 11,001 65,450 65,500 12,399 8,951 12,399 11,014 65,500 65,550 12,411 8,959 12,411 11,026 65,550 65,600 12,424 8,966 12,424 11,039 65,600 65,650 12,436 8,974 12,436 11,051 65,650 65,700 12,449 8,981 12,449 11,064 65,700 65,750 12,461 8,989 12,461 11,076 65,750 65,800 12,474 8,996 12,474 11,089 65,800 65,850 12,486 9,004 12,486 11,101 65,850 65,900 12,499 9,011 12,499 11,114 65,900 65,950 12,511 9,019 12,511 11,126 65,950 66,000 12,524 9,026 12,524 11,139

(Continued)

*This column must also be used by a qualifying widow(er).

Need more information or forms? Visit IRS.gov. -86-

Page 87 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

2012 Tax Table—Continued If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 66,000

66,000 66,050 12,536 9,034 12,536 11,151 66,050 66,100 12,549 9,041 12,549 11,164 66,100 66,150 12,561 9,049 12,561 11,176 66,150 66,200 12,574 9,056 12,574 11,189 66,200 66,250 12,586 9,064 12,586 11,201 66,250 66,300 12,599 9,071 12,599 11,214 66,300 66,350 12,611 9,079 12,611 11,226 66,350 66,400 12,624 9,086 12,624 11,239 66,400 66,450 12,636 9,094 12,636 11,251 66,450 66,500 12,649 9,101 12,649 11,264 66,500 66,550 12,661 9,109 12,661 11,276 66,550 66,600 12,674 9,116 12,674 11,289 66,600 66,650 12,686 9,124 12,686 11,301 66,650 66,700 12,699 9,131 12,699 11,314 66,700 66,750 12,711 9,139 12,711 11,326 66,750 66,800 12,724 9,146 12,724 11,339 66,800 66,850 12,736 9,154 12,736 11,351 66,850 66,900 12,749 9,161 12,749 11,364 66,900 66,950 12,761 9,169 12,761 11,376 66,950 67,000 12,774 9,176 12,774 11,389

67,000 67,000 67,050 12,786 9,184 12,786 11,401 67,050 67,100 12,799 9,191 12,799 11,414 67,100 67,150 12,811 9,199 12,811 11,426 67,150 67,200 12,824 9,206 12,824 11,439 67,200 67,250 12,836 9,214 12,836 11,451 67,250 67,300 12,849 9,221 12,849 11,464 67,300 67,350 12,861 9,229 12,861 11,476 67,350 67,400 12,874 9,236 12,874 11,489 67,400 67,450 12,886 9,244 12,886 11,501 67,450 67,500 12,899 9,251 12,899 11,514 67,500 67,550 12,911 9,259 12,911 11,526 67,550 67,600 12,924 9,266 12,924 11,539 67,600 67,650 12,936 9,274 12,936 11,551 67,650 67,700 12,949 9,281 12,949 11,564 67,700 67,750 12,961 9,289 12,961 11,576 67,750 67,800 12,974 9,296 12,974 11,589 67,800 67,850 12,986 9,304 12,986 11,601 67,850 67,900 12,999 9,311 12,999 11,614 67,900 67,950 13,011 9,319 13,011 11,626 67,950 68,000 13,024 9,326 13,024 11,639

68,000 68,000 68,050 13,036 9,334 13,036 11,651 68,050 68,100 13,049 9,341 13,049 11,664 68,100 68,150 13,061 9,349 13,061 11,676 68,150 68,200 13,074 9,356 13,074 11,689 68,200 68,250 13,086 9,364 13,086 11,701 68,250 68,300 13,099 9,371 13,099 11,714 68,300 68,350 13,111 9,379 13,111 11,726 68,350 68,400 13,124 9,386 13,124 11,739 68,400 68,450 13,136 9,394 13,136 11,751 68,450 68,500 13,149 9,401 13,149 11,764 68,500 68,550 13,161 9,409 13,161 11,776 68,550 68,600 13,174 9,416 13,174 11,789 68,600 68,650 13,186 9,424 13,186 11,801 68,650 68,700 13,199 9,431 13,199 11,814 68,700 68,750 13,211 9,439 13,211 11,826 68,750 68,800 13,224 9,446 13,224 11,839 68,800 68,850 13,236 9,454 13,236 11,851 68,850 68,900 13,249 9,461 13,249 11,864 68,900 68,950 13,261 9,469 13,261 11,876 68,950 69,000 13,274 9,476 13,274 11,889

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 69,000

69,000 69,050 13,286 9,484 13,286 11,901 69,050 69,100 13,299 9,491 13,299 11,914 69,100 69,150 13,311 9,499 13,311 11,926 69,150 69,200 13,324 9,506 13,324 11,939 69,200 69,250 13,336 9,514 13,336 11,951 69,250 69,300 13,349 9,521 13,349 11,964 69,300 69,350 13,361 9,529 13,361 11,976 69,350 69,400 13,374 9,536 13,374 11,989 69,400 69,450 13,386 9,544 13,386 12,001 69,450 69,500 13,399 9,551 13,399 12,014 69,500 69,550 13,411 9,559 13,411 12,026 69,550 69,600 13,424 9,566 13,424 12,039 69,600 69,650 13,436 9,574 13,436 12,051 69,650 69,700 13,449 9,581 13,449 12,064 69,700 69,750 13,461 9,589 13,461 12,076 69,750 69,800 13,474 9,596 13,474 12,089 69,800 69,850 13,486 9,604 13,486 12,101 69,850 69,900 13,499 9,611 13,499 12,114 69,900 69,950 13,511 9,619 13,511 12,126 69,950 70,000 13,524 9,626 13,524 12,139

70,000 70,000 70,050 13,536 9,634 13,536 12,151 70,050 70,100 13,549 9,641 13,549 12,164 70,100 70,150 13,561 9,649 13,561 12,176 70,150 70,200 13,574 9,656 13,574 12,189 70,200 70,250 13,586 9,664 13,586 12,201 70,250 70,300 13,599 9,671 13,599 12,214 70,300 70,350 13,611 9,679 13,611 12,226 70,350 70,400 13,624 9,686 13,624 12,239 70,400 70,450 13,636 9,694 13,636 12,251 70,450 70,500 13,649 9,701 13,649 12,264 70,500 70,550 13,661 9,709 13,661 12,276 70,550 70,600 13,674 9,716 13,674 12,289 70,600 70,650 13,686 9,724 13,686 12,301 70,650 70,700 13,699 9,731 13,699 12,314 70,700 70,750 13,711 9,741 13,711 12,326 70,750 70,800 13,724 9,754 13,724 12,339 70,800 70,850 13,736 9,766 13,736 12,351 70,850 70,900 13,749 9,779 13,749 12,364 70,900 70,950 13,761 9,791 13,761 12,376 70,950 71,000 13,774 9,804 13,774 12,389

71,000 71,000 71,050 13,786 9,816 13,786 12,401 71,050 71,100 13,799 9,829 13,799 12,414 71,100 71,150 13,811 9,841 13,811 12,426 71,150 71,200 13,824 9,854 13,824 12,439 71,200 71,250 13,836 9,866 13,836 12,451 71,250 71,300 13,849 9,879 13,849 12,464 71,300 71,350 13,861 9,891 13,861 12,476 71,350 71,400 13,874 9,904 13,875 12,489 71,400 71,450 13,886 9,916 13,889 12,501 71,450 71,500 13,899 9,929 13,903 12,514 71,500 71,550 13,911 9,941 13,917 12,526 71,550 71,600 13,924 9,954 13,931 12,539 71,600 71,650 13,936 9,966 13,945 12,551 71,650 71,700 13,949 9,979 13,959 12,564 71,700 71,750 13,961 9,991 13,973 12,576 71,750 71,800 13,974 10,004 13,987 12,589 71,800 71,850 13,986 10,016 14,001 12,601 71,850 71,900 13,999 10,029 14,015 12,614 71,900 71,950 14,011 10,041 14,029 12,626 71,950 72,000 14,024 10,054 14,043 12,639

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 72,000

72,000 72,050 14,036 10,066 14,057 12,651 72,050 72,100 14,049 10,079 14,071 12,664 72,100 72,150 14,061 10,091 14,085 12,676 72,150 72,200 14,074 10,104 14,099 12,689 72,200 72,250 14,086 10,116 14,113 12,701 72,250 72,300 14,099 10,129 14,127 12,714 72,300 72,350 14,111 10,141 14,141 12,726 72,350 72,400 14,124 10,154 14,155 12,739 72,400 72,450 14,136 10,166 14,169 12,751 72,450 72,500 14,149 10,179 14,183 12,764 72,500 72,550 14,161 10,191 14,197 12,776 72,550 72,600 14,174 10,204 14,211 12,789 72,600 72,650 14,186 10,216 14,225 12,801 72,650 72,700 14,199 10,229 14,239 12,814 72,700 72,750 14,211 10,241 14,253 12,826 72,750 72,800 14,224 10,254 14,267 12,839 72,800 72,850 14,236 10,266 14,281 12,851 72,850 72,900 14,249 10,279 14,295 12,864 72,900 72,950 14,261 10,291 14,309 12,876 72,950 73,000 14,274 10,304 14,323 12,889

73,000 73,000 73,050 14,286 10,316 14,337 12,901 73,050 73,100 14,299 10,329 14,351 12,914 73,100 73,150 14,311 10,341 14,365 12,926 73,150 73,200 14,324 10,354 14,379 12,939 73,200 73,250 14,336 10,366 14,393 12,951 73,250 73,300 14,349 10,379 14,407 12,964 73,300 73,350 14,361 10,391 14,421 12,976 73,350 73,400 14,374 10,404 14,435 12,989 73,400 73,450 14,386 10,416 14,449 13,001 73,450 73,500 14,399 10,429 14,463 13,014 73,500 73,550 14,411 10,441 14,477 13,026 73,550 73,600 14,424 10,454 14,491 13,039 73,600 73,650 14,436 10,466 14,505 13,051 73,650 73,700 14,449 10,479 14,519 13,064 73,700 73,750 14,461 10,491 14,533 13,076 73,750 73,800 14,474 10,504 14,547 13,089 73,800 73,850 14,486 10,516 14,561 13,101 73,850 73,900 14,499 10,529 14,575 13,114 73,900 73,950 14,511 10,541 14,589 13,126 73,950 74,000 14,524 10,554 14,603 13,139

74,000 74,000 74,050 14,536 10,566 14,617 13,151 74,050 74,100 14,549 10,579 14,631 13,164 74,100 74,150 14,561 10,591 14,645 13,176 74,150 74,200 14,574 10,604 14,659 13,189 74,200 74,250 14,586 10,616 14,673 13,201 74,250 74,300 14,599 10,629 14,687 13,214 74,300 74,350 14,611 10,641 14,701 13,226 74,350 74,400 14,624 10,654 14,715 13,239 74,400 74,450 14,636 10,666 14,729 13,251 74,450 74,500 14,649 10,679 14,743 13,264 74,500 74,550 14,661 10,691 14,757 13,276 74,550 74,600 14,674 10,704 14,771 13,289 74,600 74,650 14,686 10,716 14,785 13,301 74,650 74,700 14,699 10,729 14,799 13,314 74,700 74,750 14,711 10,741 14,813 13,326 74,750 74,800 14,724 10,754 14,827 13,339 74,800 74,850 14,736 10,766 14,841 13,351 74,850 74,900 14,749 10,779 14,855 13,364 74,900 74,950 14,761 10,791 14,869 13,376 74,950 75,000 14,774 10,804 14,883 13,389

(Continued)

*This column must also be used by a qualifying widow(er).

-87- Need more information or forms? Visit IRS.gov.

Page 88 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

2012 Tax Table—Continued If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 75,000

75,000 75,050 14,786 10,816 14,897 13,401 75,050 75,100 14,799 10,829 14,911 13,414 75,100 75,150 14,811 10,841 14,925 13,426 75,150 75,200 14,824 10,854 14,939 13,439 75,200 75,250 14,836 10,866 14,953 13,451 75,250 75,300 14,849 10,879 14,967 13,464 75,300 75,350 14,861 10,891 14,981 13,476 75,350 75,400 14,874 10,904 14,995 13,489 75,400 75,450 14,886 10,916 15,009 13,501 75,450 75,500 14,899 10,929 15,023 13,514 75,500 75,550 14,911 10,941 15,037 13,526 75,550 75,600 14,924 10,954 15,051 13,539 75,600 75,650 14,936 10,966 15,065 13,551 75,650 75,700 14,949 10,979 15,079 13,564 75,700 75,750 14,961 10,991 15,093 13,576 75,750 75,800 14,974 11,004 15,107 13,589 75,800 75,850 14,986 11,016 15,121 13,601 75,850 75,900 14,999 11,029 15,135 13,614 75,900 75,950 15,011 11,041 15,149 13,626 75,950 76,000 15,024 11,054 15,163 13,639

76,000 76,000 76,050 15,036 11,066 15,177 13,651 76,050 76,100 15,049 11,079 15,191 13,664 76,100 76,150 15,061 11,091 15,205 13,676 76,150 76,200 15,074 11,104 15,219 13,689 76,200 76,250 15,086 11,116 15,233 13,701 76,250 76,300 15,099 11,129 15,247 13,714 76,300 76,350 15,111 11,141 15,261 13,726 76,350 76,400 15,124 11,154 15,275 13,739 76,400 76,450 15,136 11,166 15,289 13,751 76,450 76,500 15,149 11,179 15,303 13,764 76,500 76,550 15,161 11,191 15,317 13,776 76,550 76,600 15,174 11,204 15,331 13,789 76,600 76,650 15,186 11,216 15,345 13,801 76,650 76,700 15,199 11,229 15,359 13,814 76,700 76,750 15,211 11,241 15,373 13,826 76,750 76,800 15,224 11,254 15,387 13,839 76,800 76,850 15,236 11,266 15,401 13,851 76,850 76,900 15,249 11,279 15,415 13,864 76,900 76,950 15,261 11,291 15,429 13,876 76,950 77,000 15,274 11,304 15,443 13,889

77,000 77,000 77,050 15,286 11,316 15,457 13,901 77,050 77,100 15,299 11,329 15,471 13,914 77,100 77,150 15,311 11,341 15,485 13,926 77,150 77,200 15,324 11,354 15,499 13,939 77,200 77,250 15,336 11,366 15,513 13,951 77,250 77,300 15,349 11,379 15,527 13,964 77,300 77,350 15,361 11,391 15,541 13,976 77,350 77,400 15,374 11,404 15,555 13,989 77,400 77,450 15,386 11,416 15,569 14,001 77,450 77,500 15,399 11,429 15,583 14,014 77,500 77,550 15,411 11,441 15,597 14,026 77,550 77,600 15,424 11,454 15,611 14,039 77,600 77,650 15,436 11,466 15,625 14,051 77,650 77,700 15,449 11,479 15,639 14,064 77,700 77,750 15,461 11,491 15,653 14,076 77,750 77,800 15,474 11,504 15,667 14,089 77,800 77,850 15,486 11,516 15,681 14,101 77,850 77,900 15,499 11,529 15,695 14,114 77,900 77,950 15,511 11,541 15,709 14,126 77,950 78,000 15,524 11,554 15,723 14,139

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 78,000

78,000 78,050 15,536 11,566 15,737 14,151 78,050 78,100 15,549 11,579 15,751 14,164 78,100 78,150 15,561 11,591 15,765 14,176 78,150 78,200 15,574 11,604 15,779 14,189 78,200 78,250 15,586 11,616 15,793 14,201 78,250 78,300 15,599 11,629 15,807 14,214 78,300 78,350 15,611 11,641 15,821 14,226 78,350 78,400 15,624 11,654 15,835 14,239 78,400 78,450 15,636 11,666 15,849 14,251 78,450 78,500 15,649 11,679 15,863 14,264 78,500 78,550 15,661 11,691 15,877 14,276 78,550 78,600 15,674 11,704 15,891 14,289 78,600 78,650 15,686 11,716 15,905 14,301 78,650 78,700 15,699 11,729 15,919 14,314 78,700 78,750 15,711 11,741 15,933 14,326 78,750 78,800 15,724 11,754 15,947 14,339 78,800 78,850 15,736 11,766 15,961 14,351 78,850 78,900 15,749 11,779 15,975 14,364 78,900 78,950 15,761 11,791 15,989 14,376 78,950 79,000 15,774 11,804 16,003 14,389

79,000 79,000 79,050 15,786 11,816 16,017 14,401 79,050 79,100 15,799 11,829 16,031 14,414 79,100 79,150 15,811 11,841 16,045 14,426 79,150 79,200 15,824 11,854 16,059 14,439 79,200 79,250 15,836 11,866 16,073 14,451 79,250 79,300 15,849 11,879 16,087 14,464 79,300 79,350 15,861 11,891 16,101 14,476 79,350 79,400 15,874 11,904 16,115 14,489 79,400 79,450 15,886 11,916 16,129 14,501 79,450 79,500 15,899 11,929 16,143 14,514 79,500 79,550 15,911 11,941 16,157 14,526 79,550 79,600 15,924 11,954 16,171 14,539 79,600 79,650 15,936 11,966 16,185 14,551 79,650 79,700 15,949 11,979 16,199 14,564 79,700 79,750 15,961 11,991 16,213 14,576 79,750 79,800 15,974 12,004 16,227 14,589 79,800 79,850 15,986 12,016 16,241 14,601 79,850 79,900 15,999 12,029 16,255 14,614 79,900 79,950 16,011 12,041 16,269 14,626 79,950 80,000 16,024 12,054 16,283 14,639

80,000 80,000 80,050 16,036 12,066 16,297 14,651 80,050 80,100 16,049 12,079 16,311 14,664 80,100 80,150 16,061 12,091 16,325 14,676 80,150 80,200 16,074 12,104 16,339 14,689 80,200 80,250 16,086 12,116 16,353 14,701 80,250 80,300 16,099 12,129 16,367 14,714 80,300 80,350 16,111 12,141 16,381 14,726 80,350 80,400 16,124 12,154 16,395 14,739 80,400 80,450 16,136 12,166 16,409 14,751 80,450 80,500 16,149 12,179 16,423 14,764 80,500 80,550 16,161 12,191 16,437 14,776 80,550 80,600 16,174 12,204 16,451 14,789 80,600 80,650 16,186 12,216 16,465 14,801 80,650 80,700 16,199 12,229 16,479 14,814 80,700 80,750 16,211 12,241 16,493 14,826 80,750 80,800 16,224 12,254 16,507 14,839 80,800 80,850 16,236 12,266 16,521 14,851 80,850 80,900 16,249 12,279 16,535 14,864 80,900 80,950 16,261 12,291 16,549 14,876 80,950 81,000 16,274 12,304 16,563 14,889

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 81,000

81,000 81,050 16,286 12,316 16,577 14,901 81,050 81,100 16,299 12,329 16,591 14,914 81,100 81,150 16,311 12,341 16,605 14,926 81,150 81,200 16,324 12,354 16,619 14,939 81,200 81,250 16,336 12,366 16,633 14,951 81,250 81,300 16,349 12,379 16,647 14,964 81,300 81,350 16,361 12,391 16,661 14,976 81,350 81,400 16,374 12,404 16,675 14,989 81,400 81,450 16,386 12,416 16,689 15,001 81,450 81,500 16,399 12,429 16,703 15,014 81,500 81,550 16,411 12,441 16,717 15,026 81,550 81,600 16,424 12,454 16,731 15,039 81,600 81,650 16,436 12,466 16,745 15,051 81,650 81,700 16,449 12,479 16,759 15,064 81,700 81,750 16,461 12,491 16,773 15,076 81,750 81,800 16,474 12,504 16,787 15,089 81,800 81,850 16,486 12,516 16,801 15,101 81,850 81,900 16,499 12,529 16,815 15,114 81,900 81,950 16,511 12,541 16,829 15,126 81,950 82,000 16,524 12,554 16,843 15,139

82,000 82,000 82,050 16,536 12,566 16,857 15,151 82,050 82,100 16,549 12,579 16,871 15,164 82,100 82,150 16,561 12,591 16,885 15,176 82,150 82,200 16,574 12,604 16,899 15,189 82,200 82,250 16,586 12,616 16,913 15,201 82,250 82,300 16,599 12,629 16,927 15,214 82,300 82,350 16,611 12,641 16,941 15,226 82,350 82,400 16,624 12,654 16,955 15,239 82,400 82,450 16,636 12,666 16,969 15,251 82,450 82,500 16,649 12,679 16,983 15,264 82,500 82,550 16,661 12,691 16,997 15,276 82,550 82,600 16,674 12,704 17,011 15,289 82,600 82,650 16,686 12,716 17,025 15,301 82,650 82,700 16,699 12,729 17,039 15,314 82,700 82,750 16,711 12,741 17,053 15,326 82,750 82,800 16,724 12,754 17,067 15,339 82,800 82,850 16,736 12,766 17,081 15,351 82,850 82,900 16,749 12,779 17,095 15,364 82,900 82,950 16,761 12,791 17,109 15,376 82,950 83,000 16,774 12,804 17,123 15,389

83,000 83,000 83,050 16,786 12,816 17,137 15,401 83,050 83,100 16,799 12,829 17,151 15,414 83,100 83,150 16,811 12,841 17,165 15,426 83,150 83,200 16,824 12,854 17,179 15,439 83,200 83,250 16,836 12,866 17,193 15,451 83,250 83,300 16,849 12,879 17,207 15,464 83,300 83,350 16,861 12,891 17,221 15,476 83,350 83,400 16,874 12,904 17,235 15,489 83,400 83,450 16,886 12,916 17,249 15,501 83,450 83,500 16,899 12,929 17,263 15,514 83,500 83,550 16,911 12,941 17,277 15,526 83,550 83,600 16,924 12,954 17,291 15,539 83,600 83,650 16,936 12,966 17,305 15,551 83,650 83,700 16,949 12,979 17,319 15,564 83,700 83,750 16,961 12,991 17,333 15,576 83,750 83,800 16,974 13,004 17,347 15,589 83,800 83,850 16,986 13,016 17,361 15,601 83,850 83,900 16,999 13,029 17,375 15,614 83,900 83,950 17,011 13,041 17,389 15,626 83,950 84,000 17,024 13,054 17,403 15,639

(Continued)

*This column must also be used by a qualifying widow(er).

Need more information or forms? Visit IRS.gov. -88-

Page 89 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

2012 Tax Table—Continued If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 84,000

84,000 84,050 17,036 13,066 17,417 15,651 84,050 84,100 17,049 13,079 17,431 15,664 84,100 84,150 17,061 13,091 17,445 15,676 84,150 84,200 17,074 13,104 17,459 15,689 84,200 84,250 17,086 13,116 17,473 15,701 84,250 84,300 17,099 13,129 17,487 15,714 84,300 84,350 17,111 13,141 17,501 15,726 84,350 84,400 17,124 13,154 17,515 15,739 84,400 84,450 17,136 13,166 17,529 15,751 84,450 84,500 17,149 13,179 17,543 15,764 84,500 84,550 17,161 13,191 17,557 15,776 84,550 84,600 17,174 13,204 17,571 15,789 84,600 84,650 17,186 13,216 17,585 15,801 84,650 84,700 17,199 13,229 17,599 15,814 84,700 84,750 17,211 13,241 17,613 15,826 84,750 84,800 17,224 13,254 17,627 15,839 84,800 84,850 17,236 13,266 17,641 15,851 84,850 84,900 17,249 13,279 17,655 15,864 84,900 84,950 17,261 13,291 17,669 15,876 84,950 85,000 17,274 13,304 17,683 15,889

85,000 85,000 85,050 17,286 13,316 17,697 15,901 85,050 85,100 17,299 13,329 17,711 15,914 85,100 85,150 17,311 13,341 17,725 15,926 85,150 85,200 17,324 13,354 17,739 15,939 85,200 85,250 17,336 13,366 17,753 15,951 85,250 85,300 17,349 13,379 17,767 15,964 85,300 85,350 17,361 13,391 17,781 15,976 85,350 85,400 17,374 13,404 17,795 15,989 85,400 85,450 17,386 13,416 17,809 16,001 85,450 85,500 17,399 13,429 17,823 16,014 85,500 85,550 17,411 13,441 17,837 16,026 85,550 85,600 17,424 13,454 17,851 16,039 85,600 85,650 17,436 13,466 17,865 16,051 85,650 85,700 17,450 13,479 17,879 16,064 85,700 85,750 17,464 13,491 17,893 16,076 85,750 85,800 17,478 13,504 17,907 16,089 85,800 85,850 17,492 13,516 17,921 16,101 85,850 85,900 17,506 13,529 17,935 16,114 85,900 85,950 17,520 13,541 17,949 16,126 85,950 86,000 17,534 13,554 17,963 16,139

86,000 86,000 86,050 17,548 13,566 17,977 16,151 86,050 86,100 17,562 13,579 17,991 16,164 86,100 86,150 17,576 13,591 18,005 16,176 86,150 86,200 17,590 13,604 18,019 16,189 86,200 86,250 17,604 13,616 18,033 16,201 86,250 86,300 17,618 13,629 18,047 16,214 86,300 86,350 17,632 13,641 18,061 16,226 86,350 86,400 17,646 13,654 18,075 16,239 86,400 86,450 17,660 13,666 18,089 16,251 86,450 86,500 17,674 13,679 18,103 16,264 86,500 86,550 17,688 13,691 18,117 16,276 86,550 86,600 17,702 13,704 18,131 16,289 86,600 86,650 17,716 13,716 18,145 16,301 86,650 86,700 17,730 13,729 18,159 16,314 86,700 86,750 17,744 13,741 18,173 16,326 86,750 86,800 17,758 13,754 18,187 16,339 86,800 86,850 17,772 13,766 18,201 16,351 86,850 86,900 17,786 13,779 18,215 16,364 86,900 86,950 17,800 13,791 18,229 16,376 86,950 87,000 17,814 13,804 18,243 16,389

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 87,000

87,000 87,050 17,828 13,816 18,257 16,401 87,050 87,100 17,842 13,829 18,271 16,414 87,100 87,150 17,856 13,841 18,285 16,426 87,150 87,200 17,870 13,854 18,299 16,439 87,200 87,250 17,884 13,866 18,313 16,451 87,250 87,300 17,898 13,879 18,327 16,464 87,300 87,350 17,912 13,891 18,341 16,476 87,350 87,400 17,926 13,904 18,355 16,489 87,400 87,450 17,940 13,916 18,369 16,501 87,450 87,500 17,954 13,929 18,383 16,514 87,500 87,550 17,968 13,941 18,397 16,526 87,550 87,600 17,982 13,954 18,411 16,539 87,600 87,650 17,996 13,966 18,425 16,551 87,650 87,700 18,010 13,979 18,439 16,564 87,700 87,750 18,024 13,991 18,453 16,576 87,750 87,800 18,038 14,004 18,467 16,589 87,800 87,850 18,052 14,016 18,481 16,601 87,850 87,900 18,066 14,029 18,495 16,614 87,900 87,950 18,080 14,041 18,509 16,626 87,950 88,000 18,094 14,054 18,523 16,639

88,000 88,000 88,050 18,108 14,066 18,537 16,651 88,050 88,100 18,122 14,079 18,551 16,664 88,100 88,150 18,136 14,091 18,565 16,676 88,150 88,200 18,150 14,104 18,579 16,689 88,200 88,250 18,164 14,116 18,593 16,701 88,250 88,300 18,178 14,129 18,607 16,714 88,300 88,350 18,192 14,141 18,621 16,726 88,350 88,400 18,206 14,154 18,635 16,739 88,400 88,450 18,220 14,166 18,649 16,751 88,450 88,500 18,234 14,179 18,663 16,764 88,500 88,550 18,248 14,191 18,677 16,776 88,550 88,600 18,262 14,204 18,691 16,789 88,600 88,650 18,276 14,216 18,705 16,801 88,650 88,700 18,290 14,229 18,719 16,814 88,700 88,750 18,304 14,241 18,733 16,826 88,750 88,800 18,318 14,254 18,747 16,839 88,800 88,850 18,332 14,266 18,761 16,851 88,850 88,900 18,346 14,279 18,775 16,864 88,900 88,950 18,360 14,291 18,789 16,876 88,950 89,000 18,374 14,304 18,803 16,889

89,000 89,000 89,050 18,388 14,316 18,817 16,901 89,050 89,100 18,402 14,329 18,831 16,914 89,100 89,150 18,416 14,341 18,845 16,926 89,150 89,200 18,430 14,354 18,859 16,939 89,200 89,250 18,444 14,366 18,873 16,951 89,250 89,300 18,458 14,379 18,887 16,964 89,300 89,350 18,472 14,391 18,901 16,976 89,350 89,400 18,486 14,404 18,915 16,989 89,400 89,450 18,500 14,416 18,929 17,001 89,450 89,500 18,514 14,429 18,943 17,014 89,500 89,550 18,528 14,441 18,957 17,026 89,550 89,600 18,542 14,454 18,971 17,039 89,600 89,650 18,556 14,466 18,985 17,051 89,650 89,700 18,570 14,479 18,999 17,064 89,700 89,750 18,584 14,491 19,013 17,076 89,750 89,800 18,598 14,504 19,027 17,089 89,800 89,850 18,612 14,516 19,041 17,101 89,850 89,900 18,626 14,529 19,055 17,114 89,900 89,950 18,640 14,541 19,069 17,126 89,950 90,000 18,654 14,554 19,083 17,139

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 90,000

90,000 90,050 18,668 14,566 19,097 17,151 90,050 90,100 18,682 14,579 19,111 17,164 90,100 90,150 18,696 14,591 19,125 17,176 90,150 90,200 18,710 14,604 19,139 17,189 90,200 90,250 18,724 14,616 19,153 17,201 90,250 90,300 18,738 14,629 19,167 17,214 90,300 90,350 18,752 14,641 19,181 17,226 90,350 90,400 18,766 14,654 19,195 17,239 90,400 90,450 18,780 14,666 19,209 17,251 90,450 90,500 18,794 14,679 19,223 17,264 90,500 90,550 18,808 14,691 19,237 17,276 90,550 90,600 18,822 14,704 19,251 17,289 90,600 90,650 18,836 14,716 19,265 17,301 90,650 90,700 18,850 14,729 19,279 17,314 90,700 90,750 18,864 14,741 19,293 17,326 90,750 90,800 18,878 14,754 19,307 17,339 90,800 90,850 18,892 14,766 19,321 17,351 90,850 90,900 18,906 14,779 19,335 17,364 90,900 90,950 18,920 14,791 19,349 17,376 90,950 91,000 18,934 14,804 19,363 17,389

91,000 91,000 91,050 18,948 14,816 19,377 17,401 91,050 91,100 18,962 14,829 19,391 17,414 91,100 91,150 18,976 14,841 19,405 17,426 91,150 91,200 18,990 14,854 19,419 17,439 91,200 91,250 19,004 14,866 19,433 17,451 91,250 91,300 19,018 14,879 19,447 17,464 91,300 91,350 19,032 14,891 19,461 17,476 91,350 91,400 19,046 14,904 19,475 17,489 91,400 91,450 19,060 14,916 19,489 17,501 91,450 91,500 19,074 14,929 19,503 17,514 91,500 91,550 19,088 14,941 19,517 17,526 91,550 91,600 19,102 14,954 19,531 17,539 91,600 91,650 19,116 14,966 19,545 17,551 91,650 91,700 19,130 14,979 19,559 17,564 91,700 91,750 19,144 14,991 19,573 17,576 91,750 91,800 19,158 15,004 19,587 17,589 91,800 91,850 19,172 15,016 19,601 17,601 91,850 91,900 19,186 15,029 19,615 17,614 91,900 91,950 19,200 15,041 19,629 17,626 91,950 92,000 19,214 15,054 19,643 17,639

92,000 92,000 92,050 19,228 15,066 19,657 17,651 92,050 92,100 19,242 15,079 19,671 17,664 92,100 92,150 19,256 15,091 19,685 17,676 92,150 92,200 19,270 15,104 19,699 17,689 92,200 92,250 19,284 15,116 19,713 17,701 92,250 92,300 19,298 15,129 19,727 17,714 92,300 92,350 19,312 15,141 19,741 17,726 92,350 92,400 19,326 15,154 19,755 17,739 92,400 92,450 19,340 15,166 19,769 17,751 92,450 92,500 19,354 15,179 19,783 17,764 92,500 92,550 19,368 15,191 19,797 17,776 92,550 92,600 19,382 15,204 19,811 17,789 92,600 92,650 19,396 15,216 19,825 17,801 92,650 92,700 19,410 15,229 19,839 17,814 92,700 92,750 19,424 15,241 19,853 17,826 92,750 92,800 19,438 15,254 19,867 17,839 92,800 92,850 19,452 15,266 19,881 17,851 92,850 92,900 19,466 15,279 19,895 17,864 92,900 92,950 19,480 15,291 19,909 17,876 92,950 93,000 19,494 15,304 19,923 17,889

(Continued)

*This column must also be used by a qualifying widow(er).

-89- Need more information or forms? Visit IRS.gov.

Page 90 of 108 Fileid: … ions/I1040/2012/A/XML/Cycle10/source 21:06 - 18-Jan-2013

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

2012 Tax Table—Continued If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 93,000

93,000 93,050 19,508 15,316 19,937 17,901 93,050 93,100 19,522 15,329 19,951 17,914 93,100 93,150 19,536 15,341 19,965 17,926 93,150 93,200 19,550 15,354 19,979 17,939 93,200 93,250 19,564 15,366 19,993 17,951 93,250 93,300 19,578 15,379 20,007 17,964 93,300 93,350 19,592 15,391 20,021 17,976 93,350 93,400 19,606 15,404 20,035 17,989 93,400 93,450 19,620 15,416 20,049 18,001 93,450 93,500 19,634 15,429 20,063 18,014 93,500 93,550 19,648 15,441 20,077 18,026 93,550 93,600 19,662 15,454 20,091 18,039 93,600 93,650 19,676 15,466 20,105 18,051 93,650 93,700 19,690 15,479 20,119 18,064 93,700 93,750 19,704 15,491 20,133 18,076 93,750 93,800 19,718 15,504 20,147 18,089 93,800 93,850 19,732 15,516 20,161 18,101 93,850 93,900 19,746 15,529 20,175 18,114 93,900 93,950 19,760 15,541 20,189 18,126 93,950 94,000 19,774 15,554 20,203 18,139

94,000 94,000 94,050 19,788 15,566 20,217 18,151 94,050 94,100 19,802 15,579 20,231 18,164 94,100 94,150 19,816 15,591 20,245 18,176 94,150 94,200 19,830 15,604 20,259 18,189 94,200 94,250 19,844 15,616 20,273 18,201 94,250 94,300 19,858 15,629 20,287 18,214 94,300 94,350 19,872 15,641 20,301 18,226 94,350 94,400 19,886 15,654 20,315 18,239 94,400 94,450 19,900 15,666 20,329 18,251 94,450 94,500 19,914 15,679 20,343 18,264 94,500 94,550 19,928 15,691 20,357 18,276 94,550 94,600 19,942 15,704 20,371 18,289 94,600 94,650 19,956 15,716 20,385 18,301 94,650 94,700 19,970 15,729 20,399 18,314 94,700 94,750 19,984 15,741 20,413 18,326 94,750 94,800 19,998 15,754 20,427 18,339 94,800 94,850 20,012 15,766 20,441 18,351 94,850 94,900 20,026 15,779 20,455 18,364 94,900 94,950 20,040 15,791 20,469 18,376 94,950 95,000 20,054 15,804 20,483 18,389

95,000 95,000 95,050 20,068 15,816 20,497 18,401 95,050 95,100 20,082 15,829 20,511 18,414 95,100 95,150 20,096 15,841 20,525 18,426 95,150 95,200 20,110 15,854 20,539 18,439 95,200 95,250 20,124 15,866 20,553 18,451 95,250 95,300 20,138 15,879 20,567 18,464 95,300 95,350 20,152 15,891 20,581 18,476 95,350 95,400 20,166 15,904 20,595 18,489 95,400 95,450 20,180 15,916 20,609 18,501 95,450 95,500 20,194 15,929 20,623 18,514 95,500 95,550 20,208 15,941 20,637 18,526 95,550 95,600 20,222 15,954 20,651 18,539 95,600 95,650 20,236 15,966 20,665 18,551 95,650 95,700 20,250 15,979 20,679 18,564 95,700 95,750 20,264 15,991 20,693 18,576 95,750 95,800 20,278 16,004 20,707 18,589 95,800 95,850 20,292 16,016 20,721 18,601 95,850 95,900 20,306 16,029 20,735 18,614 95,900 95,950 20,320 16,041 20,749 18,626 95,950 96,000 20,334 16,054 20,763 18,639

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 96,000

96,000 96,050 20,348 16,066 20,777 18,651 96,050 96,100 20,362 16,079 20,791 18,664 96,100 96,150 20,376 16,091 20,805 18,676 96,150 96,200 20,390 16,104 20,819 18,689 96,200 96,250 20,404 16,116 20,833 18,701 96,250 96,300 20,418 16,129 20,847 18,714 96,300 96,350 20,432 16,141 20,861 18,726 96,350 96,400 20,446 16,154 20,875 18,739 96,400 96,450 20,460 16,166 20,889 18,751 96,450 96,500 20,474 16,179 20,903 18,764 96,500 96,550 20,488 16,191 20,917 18,776 96,550 96,600 20,502 16,204 20,931 18,789 96,600 96,650 20,516 16,216 20,945 18,801 96,650 96,700 20,530 16,229 20,959 18,814 96,700 96,750 20,544 16,241 20,973 18,826 96,750 96,800 20,558 16,254 20,987 18,839 96,800 96,850 20,572 16,266 21,001 18,851 96,850 96,900 20,586 16,279 21,015 18,864 96,900 96,950 20,600 16,291 21,029 18,876 96,950 97,000 20,614 16,304 21,043 18,889

97,000 97,000 97,050 20,628 16,316 21,057 18,901 97,050 97,100 20,642 16,329 21,071 18,914 97,100 97,150 20,656 16,341 21,085 18,926 97,150 97,200 20,670 16,354 21,099 18,939 97,200 97,250 20,684 16,366 21,113 18,951 97,250 97,300 20,698 16,379 21,127 18,964 97,300 97,350 20,712 16,391 21,141 18,976 97,350 97,400 20,726 16,404 21,155 18,989 97,400 97,450 20,740 16,416 21,169 19,001 97,450 97,500 20,754 16,429 21,183 19,014 97,500 97,550 20,768 16,441 21,197 19,026 97,550 97,600 20,782 16,454 21,211 19,039 97,600 97,650 20,796 16,466 21,225 19,051 97,650 97,700 20,810 16,479 21,239 19,064 97,700 97,750 20,824 16,491 21,253 19,076 97,750 97,800 20,838 16,504 21,267 19,089 97,800 97,850 20,852 16,516 21,281 19,101 97,850 97,900 20,866 16,529 21,295 19,114 97,900 97,950 20,880 16,541 21,309 19,126 97,950 98,000 20,894 16,554 21,323 19,139

98,000 98,000 98,050 20,908 16,566 21,337 19,151 98,050 98,100 20,922 16,579 21,351 19,164 98,100 98,150 20,936 16,591 21,365 19,176 98,150 98,200 20,950 16,604 21,379 19,189 98,200 98,250 20,964 16,616 21,393 19,201 98,250 98,300 20,978 16,629 21,407 19,214 98,300 98,350 20,992 16,641 21,421 19,226 98,350 98,400 21,006 16,654 21,435 19,239 98,400 98,450 21,020 16,666 21,449 19,251 98,450 98,500 21,034 16,679 21,463 19,264 98,500 98,550 21,048 16,691 21,477 19,276 98,550 98,600 21,062 16,704 21,491 19,289 98,600 98,650 21,076 16,716 21,505 19,301 98,650 98,700 21,090 16,729 21,519 19,314 98,700 98,750 21,104 16,741 21,533 19,326 98,750 98,800 21,118 16,754 21,547 19,339 98,800 98,850 21,132 16,766 21,561 19,351 98,850 98,900 21,146 16,779 21,575 19,364 98,900 98,950 21,160 16,791 21,589 19,376 98,950 99,000 21,174 16,804 21,603 19,389

If line 43 (taxable income) is—

And you are—

At least

But less than

Single Married filing jointly *

Married filing sepa- rately

Head of a house- hold

Your tax is— 99,000

99,000 99,050 21,188 16,816 21,617 19,401 99,050 99,100 21,202 16,829 21,631 19,414 99,100 99,150 21,216 16,841 21,645 19,426 99,150 99,200 21,230 16,854 21,659 19,439 99,200 99,250 21,244 16,866 21,673 19,451 99,250 99,300 21,258 16,879 21,687 19,464 99,300 99,350 21,272 16,891 21,701 19,476 99,350 99,400 21,286 16,904 21,715 19,489 99,400 99,450 21,300 16,916 21,729 19,501 99,450 99,500 21,314 16,929 21,743 19,514 99,500 99,550 21,328 16,941 21,757 19,526 99,550 99,600 21,342 16,954 21,771 19,539 99,600 99,650 21,356 16,966 21,785 19,551 99,650 99,700 21,370 16,979 21,799 19,564 99,700 99,750 21,384 16,991 21,813 19,576 99,750 99,800 21,398 17,004 21,827 19,589 99,800 99,850 21,412 17,016 21,841 19,601 99,850 99,900 21,426 17,029 21,855 19,614 99,900 99,950 21,440 17,041 21,869 19,626 99,950 100,000 21,454 17,054 21,883 19,639

$100,000 or over — use the Tax

Computation Worksheet

*This column must also be used by a qualifying widow(er).

Need more information or forms? Visit IRS.gov. -90-

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2012 Tax Computation Worksheet—Line 44

CAUTION !

See the instructions for line 44 to see if you must use the worksheet below to figure your tax.

Note. If you are required to use this worksheet to figure the tax on an amount from another form or worksheet, such as the Qualified Dividends and Capital Gain Tax Worksheet, the Schedule D Tax Worksheet, Schedule J, Form 8615, or the Foreign Earned Income Tax Worksheet, enter the amount from that form or worksheet in column (a) of the row that applies to the amount you are looking up. Enter the result on the appropriate line of the form or worksheet that you are completing.

Section A—Use if your filing status is Single. Complete the row below that applies to you.

Taxable income. If line 43 is—

(a) Enter the amount from

line 43 (b)

Multiplication amount

(c) Multiply

(a) by (b) (d)

Subtraction amount

Tax. Subtract (d) from (c). Enter the result here and on Form 1040,

line 44 At least $100,000 but not over $178,650 $ × 28% (.28) $ $ 6,539.50 $ Over $178,650 but not over $388,350 $ × 33% (.33) $ $ 15,472.00 $ Over $388,350 $ × 35% (.35) $ $23,239.00 $

Section B—Use if your filing status is Married filing jointly or Qualifying widow(er). Complete the row below that applies to you.

Taxable income. If line 43 is—

(a) Enter the amount from

line 43 (b)

Multiplication amount

(c) Multiply

(a) by (b) (d)

Subtraction amount

Tax. Subtract (d) from (c). Enter the result here and on Form 1040,

line 44 At least $100,000 but not over $142,700 $ × 25% (.25) $ $ 7,940.00 $ Over $142,700 but not over $217,450 $ × 28% (.28) $ $ 12,221.00 $ Over $217,450 but not over $388,350 $ × 33% (.33) $ $ 23,093.50 $ Over $388,350 $ × 35% (.35) $ $ 30,860.50 $

Section C—Use if your filing status is Married filing separately. Complete the row below that applies to you.

Taxable income. If line 43 is—

(a) Enter the amount from

line 43 (b)

Multiplication amount

(c) Multiply

(a) by (b) (d)

Subtraction amount

Tax. Subtract (d) from (c). Enter the result here and on Form 1040,

line 44 At least $100,000 but not over $108,725 $ × 28% (.28) $ $ 6,110.50 $ Over $108,725 but not over $194,175 $ × 33% (.33) $ $ 11,546.75 $ Over $194,175 $ × 35% (.35) $ $ 15,430.25 $

Section D—Use if your filing status is Head of household. Complete the row below that applies to you.

Taxable income. If line 43 is—

(a) Enter the amount from

line 43 (b)

Multiplication amount

(c) Multiply

(a) by (b) (d)

Subtraction amount

Tax. Subtract (d) from (c). Enter the result here and on Form 1040,

line 44 At least $100,000 but not over $122,300 $ × 25% (.25) $ $ 5,355.00 $ Over $122,300 but not over $198,050 $ × 28% (.28) $ $ 9,024.00 $ Over $198,050 but not over $388,350 $ × 33% (.33) $ $ 18,926.50 $ Over $388,350 $ × 35% (.35) $ $ 26,693.50 $

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General Information How To Avoid Common Mistakes Mistakes can delay your refund or result in notices being sent to you.

Make sure you entered the correct name and social security number (SSN) for each dependent you claim on line 6c. Check that each dependent's name and SSN agrees with his or her social securi- ty card. For each child under age 17 who is a qualifying child for the child tax credit, make sure you checked the box in line 6c, column (4).

Check your math, especially for the child tax credit, earned income credit (EIC), taxable social security benefits, total income, itemized deductions or standard deduction, deduction for ex- emptions, taxable income, total tax, fed- eral income tax withheld, and refund or amount you owe.

Be sure you used the correct meth- od to figure your tax. See the instruc- tions for line 44.

Be sure to enter your SSN in the space provided on page 1 of Form 1040. If you are married filing a joint or sepa- rate return, also enter your spouse's SSN. Be sure to enter your SSN in the space next to your name. Check that your name and SSN agree with your so- cial security card.

Make sure your name and address are correct. Enter your (and your spou- se's) name in the same order as shown on your last return.

If you live in an apartment, be sure to include your apartment number in your address.

If you are taking the standard de- duction, see the instructions for line 40 to be sure you entered the correct amount.

If you received capital gain distri- butions but were not required to file Schedule D, make sure you checked the box on line 13.

If you are taking the EIC, be sure you used the correct column of the EIC Table for your filing status and the num- ber of children you have.

Remember to sign and date Form 1040 and enter your occupation(s).

Attach your Form(s) W-2 and other required forms and schedules. Put all forms and schedules in the proper order. See Assemble Your Return, earlier.

If you owe tax and are paying by check or money order, be sure to include all the required information on your pay- ment. See the instructions for line 76 for details.

Do not file more than one original return for the same year, even if you have not gotten your refund or have not heard from the IRS since you filed. Fil- ing more than one original return for the same year, or sending in more than one copy of the same return (unless we ask you to do so), could delay your refund.

What Are Your Rights as a Taxpayer? You have the right to be treated fairly, professionally, promptly, and courteous- ly by IRS employees. Our goal at the IRS is to protect your rights so that you will have the highest confidence in the integrity, efficiency, and fairness of our tax system. To ensure that you always receive such treatment, you should know about the many rights you have at each step of the tax process. For details, see Pub. 1.

Innocent Spouse Relief Generally, both you and your spouse are each responsible for paying the full amount of tax, interest, and penalties on your joint return. However, you may qualify for relief from liability for tax on a joint return if (a) there is an under- statement of tax because your spouse omitted income or claimed false deduc- tions or credits, (b) you are divorced, separated, or no longer living with your spouse, or (c) given all the facts and cir- cumstances, it would not be fair to hold you liable for the tax. You may also qualify for relief if you were a married resident of a community property state but did not file a joint return and are now liable for an underpaid or understa- ted tax. File Form 8857 to request relief. In some cases, Form 8857 may need to be filed within 2 years of the date on

which the IRS first attempted to collect the tax from you. Do not file Form 8857 with your Form 1040. For more infor- mation, see Pub. 971 and Form 8857 or you can call the Innocent Spouse office toll-free at 1-866-897-4270.

Income Tax Withholding and Estimated Tax Payments for 2013 If the amount you owe or the amount you overpaid is large, you may want to file a new Form W-4 with your employ- er to change the amount of income tax withheld from your 2013 pay. For de- tails on how to complete Form W-4, see Pub. 505. If you have pension or annuity income, use Form W-4P. If you receive certain government payments (such as unemployment compensation or social security benefits), you can have tax withheld from those payments by giving the payer Form W-4V.

You can use the IRS Withhold- ing Calculator at www.irs.gov/ Individuals/IRS-Withholding-

Calculator, instead of Pub. 505 or the worksheets included with Form W-4 or W-4P, to determine whether you need to have your withholding increased or de- creased.

In general, you do not have to make estimated tax payments if you expect that your 2013 Form 1040 will show a tax refund or a tax balance due of less than $1,000. If your total estimated tax for 2013 is $1,000 or more, see Form 1040-ES and Pub. 505 for a worksheet you can use to see if you have to make estimated tax payments. For more de- tails, see Pub. 505.

Secure Your Tax Records from Identity Theft Identity theft occurs when someone uses your personal information, such as your name, social security number (SSN), or other identifying information, without your permission, to commit fraud or oth-

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er crimes. An identity thief may use your SSN to get a job or may file a tax return using your SSN to receive a re- fund.

To reduce your risk: Protect your SSN, Ensure your employer is protecting

your SSN, and Be careful when choosing a tax

preparer.

If your tax records are affected by identity theft and you receive a notice from the IRS, respond right away to the name and phone number printed on the IRS notice or letter.

If your tax records are not currently affected by identity theft but you think you are at risk due to a lost or stolen purse or wallet, questionable credit card activity or credit report, etc., contact the IRS Identity Protection Specialized Unit at 1-800-908-4490 or submit Form 14039.

For more information, see Pub. 4535.

Victims of identity theft who are ex- periencing economic harm or a systemic problem, or are seeking help in resolv- ing tax problems that have not been re- solved through normal channels, may be eligible for Taxpayer Advocate Service (TAS) assistance. You can reach TAS by calling the National Taxpayer Advo- cate helpline at 1-877-777-4778. People who are deaf, hard of hearing, or have a speech disability and who have access to TTY/TDD equipment can call 1-800-829-4059. Deaf or hard-of-hear- ing individuals can also contact the IRS through relay services such as the Feder- al Relay Service available at www.gsa.gov/fedrelay. Protect yourself from suspicious emails or phishing schemes. Phishing is the creation and use of email and web- sites designed to mimic legitimate busi- ness emails and websites. The most common form is sending an email to a user falsely claiming to be an establish- ed legitimate enterprise in an attempt to scam the user into surrendering private information that will be used for identity theft.

The IRS does not initiate contacts with taxpayers via emails. Also, the IRS does not request detailed personal infor- mation through email or ask taxpayers

for the PIN numbers, passwords, or sim- ilar secret access information for their credit card, bank, or other financial ac- counts.

If you receive an unsolicited email claiming to be from the IRS, forward the message to [email protected]. You may also report misuse of the IRS name, logo, forms, or other IRS property to the Treasury Inspector General for Tax Ad- ministration toll-free at 1-800-366-4484. People who are deaf, hard of hearing, or have a speech disability and who have access to TTY/TDD equipment can call 1-800-877-8339. You can forward sus- picious emails to the Federal Trade Commission at [email protected] or con- tact them at www.ftc.gov/idtheft or 1-877-IDTHEFT (1-877-438-4338). People who are deaf, hard of hearing, or have a speech disability and who have access to TTY/TDD equipment can call 1-866-653-4261.

Visit IRS.gov and enter “identity theft” in the search box to learn more about identity theft and how to reduce your risk.

How Do You Make a Gift To Reduce Debt Held By the Public? If you wish to do so, make a check paya- ble to “Bureau of the Public Debt.” You can send it to: Bureau of the Public Debt, Department G, P.O. Box 2188, Parkersburg, WV 26106-2188. Or you can enclose the check with your income tax return when you file. Do not add your gift to any tax you may owe. See the instructions for line 76 for details on how to pay any tax you owe. Go to www.publicdebt.treas.gov/ for informa- tion on how to make this type of gift on- line.

You may be able to deduct this gift on your 2013 tax return.

How Long Should Records Be Kept? Keep a copy of your tax return, work- sheets you used, and records of all items appearing on it (such as Forms W-2 and 1099) until the statute of limitations runs out for that return. Usually, this is 3

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years from the date the return was due or filed or 2 years from the date the tax was paid, whichever is later. You should keep some records longer. For example, keep property records (including those on your home) as long as they are need- ed to figure the basis of the original or replacement property. For more details, see chapter 1 of Pub. 17.

Amended Return File Form 1040X to change a return you already filed. Generally, Form 1040X must be filed within 3 years after the date the original return was filed or within 2 years after the date the tax was paid, whichever is later. But you may have more time to file Form 1040X if you live in a federally declared disaster area or you are physically or mentally unable to manage your financial affairs. See Pub. 556 for details.

Need a Copy of Your Tax Return? If you need a copy of your tax return, use Form 4506. There is a $57 fee (sub- ject to change) for each return requested. If your main home, principal place of business, or tax records are located in a federally declared disaster area, this fee will be waived. If you want a free tran- script of your tax return or account, use Form 4506-T or 4506T-EZ, visit IRS.gov and click on “Order a Return or Account Transcript,” or call us at 1-800-908-9946.

Death of a Taxpayer If a taxpayer died before filing a return for 2012, the taxpayer's spouse or per- sonal representative may have to file and sign a return for that taxpayer. A person- al representative can be an executor, ad- ministrator, or anyone who is in charge of the deceased taxpayer's property. If the deceased taxpayer did not have to file a return but had tax withheld, a re- turn must be filed to get a refund. The person who files the return must enter “Deceased,” the deceased taxpayer's name, and the date of death across the top of the return. If this information is not provided, it may delay the process- ing of the return.

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If your spouse died in 2012 and you did not remarry in 2012, or if your spouse died in 2013 before filing a re- turn for 2012, you can file a joint return. A joint return should show your spouse's 2012 income before death and your in- come for all of 2012. Enter “Filing as surviving spouse” in the area where you sign the return. If someone else is the personal representative, he or she must also sign.

The surviving spouse or personal rep- resentative should promptly notify all payers of income, including financial in- stitutions, of the taxpayer's death. This will ensure the proper reporting of in- come earned by the taxpayer's estate or heirs. A deceased taxpayer's social se- curity number should not be used for tax years after the year of death, except for estate tax return purposes.

Claiming a Refund for a Deceased Taxpayer If you are filing a joint return as a sur- viving spouse, you only need to file the tax return to claim the refund. If you are a court-appointed representative, file the return and include a copy of the certifi- cate that shows your appointment. All other filers requesting the deceased tax- payer's refund must file the return and attach Form 1310.

For more details, use TeleTax topic 356 or see Pub. 559.

Past Due Returns If you or someone you know needs to file past due tax returns, use TeleTax topic 153 or go to www.irs.gov/ individuals for help in filing those re- turns. Send the return to the address that applies to you in the latest Form 1040 instructions. For example, if you are fil- ing a 2009 return in 2013, use the ad- dress at the end of these instructions. However, if you got an IRS notice, mail the return to the address in the notice.

Other Ways To Get Help Send Your Written Tax Questions to the IRS You should get an answer in about 30 days. For the mailing address, call us at 1-800-829-1040. People who are deaf, hard of hearing, or have a speech disa-

bility and who have access to TTY/TDD equipment can call 1-800-829-4059. Deaf or hard-of-hearing individuals can also contact the IRS through relay serv- ices such as the Federal Relay Service available at www.gsa.gov/fedrelay. Do not send questions with your return.

Research Your Tax Questions Online You can find answers to many of your tax questions online. Go to www.irs.gov/ individuals. Here are some of the meth- ods you may want to try.

Frequently asked questions. This section contains an extensive list of questions and answers. You can select your question by category or keyword.

Tax trails. This is an interactive section which asks questions you can answer by selecting “Yes” or “No.”

Main index of tax topics. This is an online version of the TeleTax topics.

Interactive Tax Assistant (ITA). The ITA provides answers to certain tax law questions using a probe and re- sponse process.

Free Tax Return Assistance Free help with your return. If you need assistance preparing your return, visit the nearest Volunteer Income Tax Assistance (VITA) or Tax Counseling for the Elderly (TCE) site in your com- munity. There are thousands of sites na- tionwide and each site is staffed by vol- unteers who are trained and certified to prepare federal income tax returns. VI- TA sites are also available at interna- tional and domestic military installa- tions.

Volunteers in this program must ad- here to strict quality and ethical stand- ards and pass a certification test each year. The VITA Program generally of- fers free tax help to people who make $50,000 or less and need assistance in preparing their own tax return. The TCE Program offers free tax help for all, with priority assistance to people who are 60 years of age and older, specializing in questions about pensions and retirement issues unique to seniors. Available services. Free electronic fil- ing is offered and volunteers will help you claim the earned income credit, child tax credit, credit for the elderly,

and other credits and deductions you can take. What to bring. These are some of the items to bring to the VITA/TCE site to have your tax return prepared.

Proof of identification. Social security cards for you, your

spouse and dependents and/or a social security number verification letter issued by the Social Security Administration.

Individual taxpayer identification number (ITIN) assignment letter for you, your spouse and dependents.

Proof of foreign status, if applying for an ITIN.

Birth dates for you, your spouse, and any dependents.

Form(s) W-2, W-2G, 1099-INT, 1099-DIV, and 1099-R.

A copy of your 2011 federal and state returns, if available.

A blank check or anything that shows your bank routing and account numbers for direct deposit.

Total paid to daycare provider and the daycare provider's tax identification number (the provider's social security number or the provider's business em- ployer identification number).

To file taxes electronically on a joint return, both spouses must be present to sign the required forms. Find a site near you and get addition­ al information. For more information on these programs and a location in your community, go to IRS.gov and enter keyword “VITA” in the search box. You may also contact us at 1-800-829-1040. To locate the nearest AARP Tax-Aide site, visit AARP’s website at www.aarp.org/money/taxaide or call 1-888-227-7669.

Everyday Tax Solutions You can get face-to-face help solving tax problems most business days in IRS Taxpayer Assistance Centers. An em- ployee can explain IRS letters, request adjustments to your account, or help you set up a payment plan. To find the num- ber to call your local TAC, go to www.irs.gov/uac/Contact-Your-Local- IRS-Office-1 or look in the phone book under “United States Government, Inter- nal Revenue Service.”

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IRS Videos The IRS Video portal www.IRSvideos.gov contains video and audio presentations on topics of interest to small businesses, individuals, and tax professionals. You will find video clips of tax topics, archived versions of live panel discussions and Webinars, and au- dio archives of tax practitioner phone fo- rums.

Help for People With Disabilities People who are deaf, hard of hearing, or have a speech disability and who have access to TTY/TDD equipment can call 1-800-829-4059. Deaf or hard-of-hear- ing individuals can also contact the IRS through relay services such as the Feder- al Relay Service available at www.gsa.gov/fedrelay. Braille materials are available at libraries that have spe- cial services for people with disabilities.

Tax Services in Other Languages To better serve taxpayers whose native language is not English, we have prod- ucts and services in various languages.

For Spanish speaking taxpayers, we have:

Spanish Publication 17, El Impues- to Federal sobre los Ingresos, and

www.irs.gov/espanol. We also offer a Basic Tax Responsi-

bilities CD/DVD in the following lan- guages.

Spanish. Chinese. Vietnamese. Korean. Russian.

To get a copy of this CD/DVD, call the National Distribution Center at

1-800-829-3676 and ask for Pub. 4580 in your language.

The IRS Taxpayer Assistance Centers provide over-the-phone interpreter as-

sistance in more than 170 different lan- guages. To find the number, see Every- day Tax Solutions earlier.

Interest and Penalties You do not have to figure the amount of any interest or penalties you may owe. Because figuring these amounts can be complicated, we will do it for you if you want. We will send you a bill for any amount due.

If you include interest or penalties (other than the estimated tax penalty) with your payment, identify and enter the amount in the bottom margin of Form 1040, page 2. Do not include in- terest or penalties (other than the estima- ted tax penalty) in the amount you owe on line 76.

Interest We will charge you interest on taxes not paid by their due date, even if an exten- sion of time to file is granted. We will also charge you interest on penalties im- posed for failure to file, negligence, fraud, substantial valuation misstate- ments, substantial understatements of tax, and reportable transaction under- statements. Interest is charged on the penalty from the due date of the return (including extensions).

Penalties Late filing. If you do not file your re- turn by the due date (including exten- sions), the penalty is usually 5% of the amount due for each month or part of a

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month your return is late, unless you have a reasonable explanation. If you do, include it with your return. The pen- alty can be as much as 25% of the tax due. The penalty is 15% per month, up to a maximum of 75%, if the failure to file is fraudulent. If your return is more than 60 days late, the minimum penalty will be $135 or the amount of any tax you owe, whichever is smaller. Late payment of tax. If you pay your taxes late, the penalty is usually 1 2 of 1% of the unpaid amount for each month or part of a month the tax is not paid. The penalty can be as much as 25% of the unpaid amount. It applies to any unpaid tax on the return. This penalty is in addi- tion to interest charges on late payments. Frivolous return. In addition to any other penalties, the law imposes a penal- ty of $5,000 for filing a frivolous return. A frivolous return is one that does not contain information needed to figure the correct tax or shows a substantially in- correct tax because you take a frivolous position or desire to delay or interfere with the tax laws. This includes altering or striking out the preprinted language above the space where you sign. For a list of positions identified as frivolous, see Notice 2010-33, 2010-17 I.R.B. 609, available at www.irs.gov/irb/ 2010-17_IRB/ar13.html. Other. Other penalties can be imposed for negligence, substantial understate- ment of tax, reportable transaction un- derstatements, filing an erroneous re- fund claim, and fraud. Criminal penalties may be imposed for willful failure to file, tax evasion, making a false statement, or identity theft. See Pub. 17 for details on some of these pen- alties.

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Refund Information Visit IRS.gov and click on Where's My

Refund? 24 hours a day, 7 days a week. Information about your return will gen- erally be available within 24 hours after the IRS receives your e-filed return, or 4 weeks after you mail a paper return. But if you filed Form 8379 with your return, allow 14 weeks (11 weeks if you filed electronically) before checking your re- fund status.

To use Where's My Refund? have a copy of your tax return handy. You will need to pro-

vide the following information from your return:

Your social security number (or in- dividual taxpayer identification num- ber),

Your filing status, and The exact whole dollar amount of

your refund.

Where's My Refund? has a new look this year! The tool will include a tracker that displays progress through three stages: (1) return received, (2) refund approved, and (3) refund sent. Where's My Re- fund? will provide an actual personal- ized refund date as soon as the IRS pro- cesses your tax return and approves your refund.

Updates to refund status are made once a day - usually at night.

If you do not have Internet ac- cess, many services are availa- ble by phone:

You can check the status of your refund on the new IRS phone app. Download the free IRS2Go app by visit- ing the iTunes app store or the Android Marketplace. IRS2Go is a new way to provide you with information and tools.

You can call 1-800-829-4477 24 hours a day, 7 days a week, for automa- ted refund information.

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Do not send in a copy of your return unless asked to do so.

To get a refund, you generally must file your return within 3 years from the date the return was due (including exten- sions).

Where's My Refund? does not track refunds that are claimed on an amended tax return.

Refund information also is available in Spanish at www.irs.gov/espanol and 1-800-829-4477.

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What Is TeleTax? Recorded Tax Information Recorded tax information is available 24 hours a day, 7 days a week. Select the

number of the topic you want to hear. Then, call 1-800-829-4477. Have paper and pencil handy to take notes.

Topics by Internet TeleTax topics are also available at www.irs.gov/taxtopics.

TeleTax Topics All topics are available in Spanish. Topic No. Subject

IRS Help Available 101 IRS services—Volunteer tax

assistance, toll-free telephone, walk-in assistance, outreach programs, and identity theft

102 Tax assistance for individuals with disabilities and the deaf or hard of hearing

103 Tax help for small businesses and self-employed

104 Taxpayer Advocate Service—Your voice at the IRS

105 Armed Forces tax information 107 Tax relief in disaster situations

IRS Procedures 151 Your appeal rights 152 Refund information 153 What to do if you haven't filed your

tax return 154 Form W-2 and Form 1099-R (What

to do if incorrect or not received) 155 Forms and publications—How to

order 156 Copy of your tax return—How to

get one 157 Change of address—How to notify

IRS 158 Ensuring proper credit of payments 159 Prior year(s) Form W-2 (How to

get a copy) 160 Form 1099-A (Acquisition or

Abandonment of Secured Property) and Form 1099-C (Cancellation of Debt) Collection

201 The collection process 202 Tax payment options 203 Refund offsets: For unpaid child

support and certain federal, state, and unemployment compensation debts

204 Offers in compromise 205 Innocent spouse relief (Including

separation of liability and equitable relief)

Topic No. Subject 206 Dishonored payments

Alternative Filing Methods 253 Substitute tax forms 254 How to choose a tax return preparer 255 Self-select PIN signature method

for online registration General Information

301 When, where, and how to file 303 Checklist of common errors when

preparing your tax return 304 Extensions of time to file your tax

return 305 Recordkeeping 306 Penalty for underpayment of

estimated tax 307 Backup withholding 308 Amended returns 309 Roth IRA contributions 310 Coverdell education savings

accounts 311 Power of attorney information 312 Disclosure authorizations 313 Qualified tuition programs (QTPs)

Which Forms to File 352 Which form—1040, 1040A, or

1040EZ? 356 Decedents

Types of Income 401 Wages and salaries 403 Interest received 404 Dividends 407 Business income 409 Capital gains and losses 410 Pensions and annuities 411 Pensions—The general rule and the

simplified method 412 Lump-sum distributions 413 Rollovers from retirement plans 414 Rental income and expenses 415 Renting residential and vacation

property 416 Farming and fishing income 417 Earnings for clergy 418 Unemployment compensation 419 Gambling income and losses 420 Bartering income 421 Scholarship and fellowship grants 423 Social security and equivalent

railroad retirement benefits

Topic No. Subject 424 401(k) plans 425 Passive activities—Losses and

credits 427 Stock options 429 Traders in securities (information

for Form 1040 filers) 430 Receipt of stock in a

demutualization 431 Canceled debt—Is it Taxable or

Not? Adjustments to Income

451 Individual retirement arrangements (IRAs)

452 Alimony paid 453 Bad debt deduction 455 Moving expenses 456 Student loan interest deduction 457 Tuition and fees deduction 458 Educator expense deduction

Itemized Deductions 501 Should I itemize? 502 Medical and dental expenses 503 Deductible taxes 504 Home mortgage points 505 Interest expense 506 Charitable contributions 508 Miscellaneous expenses 509 Business use of home 510 Business use of car 511 Business travel expenses 512 Business entertainment expenses 513 Educational expenses 514 Employee business expenses 515 Casualty, disaster, and theft losses

(including federally declared disaster areas) Tax Computation

551 Standard deduction 552 Tax and credits figured by the IRS 553 Tax on a child's investment income 554 Self-employment tax 556 Alternative minimum tax 557 Additional tax on early

distributions from traditional and Roth IRAs

558 Additional tax on early distributions from retirement plans, other than IRAs

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TeleTax Topics (Continued) Topic No. Subject

Tax Credits 601 Earned income credit 602 Child and dependent care credit 607 Adoption credit and adoption

assistance programs 608 Excess social security and RRTA

tax withheld 610 Retirement savings contributions

credit 611 Repayment of the first-time

homebuyer credit IRS Notices

651 Notices—What to do 652 Notice of underreported

income—CP 2000 653 IRS notices and bills, penalties, and

interest charges Basis of Assets, Depreciation, and Sale of Assets

701 Sale of your home 703 Basis of assets 704 Depreciation 705 Installment sales

Employer Tax Information 751 Social security and Medicare

withholding rates 752 Form W-2—Where, when, and

how to file 753 Form W-4—Employee's

Withholding Allowance Certificate 755 Employer identification number

(EIN)—How to apply

Topic No. Subject 756 Employment taxes for household

employees 757 Forms 941 and 944—Deposit

requirements 758 Form 941—Employer's Quarterly

Federal Tax Return and Form 944—Employer's Annual Federal Tax Return

759 Form 940—Employer's Annual Federal Unemployment (FUTA) Tax Return—Filing and deposit requirements

760 Reporting and deposit requirements for agricultural employers

761 Tips—Withholding and reporting 762 Independent contractor vs.

employee 763 The Affordable Care Act of 2010

offers new tax deductions and credits Electronic Media Filers—1099 Series and Related Information Returns

801 Who must file electronically 802 Applications, forms, and

information 803 Waivers and extensions 804 Test files and combined federal and

state filing 805 Electronic filing of information

returns Tax Information for Aliens and U.S. Citizens Living Abroad

851 Resident and nonresident aliens 856 Foreign tax credit

Topic No. Subject 857 Individual taxpayer identification

number (ITIN)—Form W-7 858 Alien tax clearance

Tax Information for Residents of Puerto Rico

901 Is a person with income from Puerto Rican sources required to file a U.S. federal income tax return?

902 Credits and deductions for taxpayers with Puerto Rican source income that is exempt from U.S. tax

903 Federal employment tax in Puerto Rico

904 Tax assistance for residents of Puerto Rico

Topic numbers are effective January 1, 2013.

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Calling the IRS If you cannot find the answer to your question in these instructions or online, please call us for assistance. See Making the Call below. You will not be charged for the call unless your phone company charges you for toll-free calls. Our normal hours of opera- tion are Monday through Friday from 7:00 a.m. to 7:00 p.m. local time. Assistance provided to callers from Alaska and Hawaii will be based on the hours of operation in the Pacific time zone. Callers from Puerto Rico will receive assistance from 8:00 a.m. to 8:00 p.m. local time.

If you want to check the status of your 2012 refund, see Refund Information, earlier.TIP

Before You Call IRS representatives care about the quali- ty of the service provided to you, our customer. You can help us provide accu- rate, complete answers to your questions by having the following information available.

The tax form, schedule, or notice to which your question relates.

The facts about your particular sit- uation. The answer to the same question often varies from one taxpayer to anoth- er because of differences in their age, in- come, whether they can be claimed as a dependent, etc.

The name of any IRS publication or other source of information that you used to look for the answer.

To maintain your account security, you may be asked for the following in- formation, which you should also have available.

Your social security number. The amount of refund and filing

status shown on your tax return. The “Caller ID Number” shown at

the top of any notice you received.

Your personal identification num- ber (PIN) if you have one.

Your date of birth. The numbers in your street address. Your ZIP code.

If you are asking for an installment agreement to pay your tax, you will be asked for the highest amount you can pay each month and the date on which you can pay it. Evaluation of services provided. The IRS uses several methods to evaluate our telephone service. One method is to record telephone calls for quality purpo- ses only. A random sample of recorded calls is selected for review through the quality assurance process. Other meth- ods include listening to live calls in pro- gress and random selection of customers for participation in a customer satisfac- tion survey.

Making the Call Call 1-800-829-1040. People who are deaf, hard of hearing, or have a speech disability and who have access to TTY/TDD equipment can call

1-800-829-4059. Deaf or hard-of-hear- ing individuals can also contact the IRS through relay services such as the Feder- al Relay Service available at www.gsa.gov/fedrelay. Our menu allows you to speak your responses or use your keypad to select a menu option. After re- ceiving your menu selection, the system will direct your call to the appropriate assistance.

Before You Hang Up If you do not fully understand the an- swer you receive, or you feel our repre- sentative may not fully understand your question, our representative needs to know this. He or she will be happy to take additional time to be sure your question is answered fully.

By law, you are responsible for pay- ing your share of federal income tax. If we should make an error in answering your question, you are still responsible for the payment of the correct tax. Should this occur, however, you will not be charged any penalty.

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Quick and Easy Access to Tax Help and Tax Forms and Publications If you live outside the United States, see Pub. 54 to find out how to get help and tax forms and publica- tions.

Internet You can access IRS.gov 24 hours a day, 7 days a week.

Online services and help. Go to IRS.gov to obtain information on:

Free File—Use free tax software to prepare and e-file your tax return at www.irs.gov/freefile.

Interactive Tax Assistant—Provides answers to tax law questions using a probe and response process.

Online Services—Conduct business with the IRS electroni- cally.

Taxpayer Advocate Service—Helps taxpayers resolve problems with the IRS.

Where's My Refund—Your refund status anytime from anywhere.

Free Tax Return Preparation—Locate the site nearest you. Recent Tax Changes Tax information for Innocent Spouses Disaster Tax Relief Identity Theft and Your Tax Records Online Payment Agreement (OPA) Application Applying for Offers in Compromise

View and download tax forms and publications. Click on “Forms & Pubs” or go to www.irs.gov/formspubs to:

View or download current and previous year tax forms and publications.

Order current year tax forms and publications online. Online ordering of tax forms and publications. To order tax forms and publications delivered by mail, go to www.irs.gov/ formspubs.

For current year tax forms and publications, click on “Forms and publications by U.S. mail.”

For tax forms and publications on a DVD, click on “Tax products DVD (Pub. 1796).”

To get information, forms, and publications in Span- ish, go to www.irs.gov/espanol.

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Phone TeleTax information - 24 hour tax informa- tion. Call 1-800-829-4477. See the earlier list of tax topic numbers and details.

Tax forms and publications. Call 1-800-TAX-FORM (1-800-829-3676) to order current and prior year forms, instruc- tions, and publications. You should receive your order within 10 working days. Tax help and questions. Call 1-800-829-1040. People who are deaf, hard of hearing, or have a speech disability and who have access to TTY/TDD equipment can call 1-800-829-4059. Deaf or hard-of-hearing individuals can also contact the IRS through relay services such as the Federal Relay Service available at www.gsa.gov/fedrelay. National Taxpayer Advocate helpline. Call 1-877-777-4778.

Walk-In You can pick up some of the most requested forms, instructions, and publications at many IRS offices, post offices, and libraries. Also, some grocery stores, copy centers, city and

county government offices, and credit unions have reproducible tax forms and publications available to photocopy or print from a DVD.

Mail You can order forms, instructions, and publica- tions by completing the order blank, later. You should receive your order within 10 days after we receive your request.

DVD Buy IRS Pub. 1796, IRS Tax Products DVD, from National Technical Information Service (NTIS) at www.irs.gov/cdorders for $30 (no handling fee) or call 1-877-233-6767 toll-free to

buy the DVD for $30 (plus a $6 handling fee). Price and han- dling fee are subject to change. The first release will ship early January 2013 and the final release will ship early March 2013.

Other ways to get help. See Other Ways To Get Help, earlier.

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Disclosure, Privacy Act, and Paperwork Reduction Act Notice The IRS Restructuring and Reform Act of 1998, the Privacy Act of 1974, and the Paperwork Reduction Act of 1980 require that when we ask you for information we must first tell you our legal right to ask for the information, why we are asking for it, and how it will be used. We must also tell you what could happen if we do not receive it and whether your response is voluntary, required to obtain a benefit, or mandatory under the law.

This notice applies to all papers you file with us, including this tax return. It also applies to any questions we need to ask you so we can complete, correct, or process your return; figure your tax; and collect tax, interest, or penalties.

Our legal right to ask for information is Internal Revenue Code sections 6001, 6011, and 6012(a), and their regulations. They say that you must file a return or statement with us for any tax you are lia- ble for. Your response is mandatory under these sections. Code section 6109 re- quires you to provide your identifying number on the return. This is so we know who you are, and can process your return and other papers. You must fill in all parts of the tax form that apply to you. But you do not have to check the boxes for the Presidential Election Campaign Fund or for the third-party designee. You also do not have to provide your daytime phone number.

You are not required to provide the in- formation requested on a form that is sub- ject to the Paperwork Reduction Act un- less the form displays a valid OMB con- trol number. Books or records relating to a form or its instructions must be retained as long as their contents may become ma- terial in the administration of any Internal Revenue law.

We ask for tax return information to carry out the tax laws of the United States. We need it to figure and collect the right amount of tax.

If you do not file a return, do not pro- vide the information we ask for, or pro- vide fraudulent information, you may be charged penalties and be subject to crimi- nal prosecution. We may also have to dis- allow the exemptions, exclusions, credits, deductions, or adjustments shown on the tax return. This could make the tax higher

or delay any refund. Interest may also be charged.

Generally, tax returns and return infor- mation are confidential, as stated in Code section 6103. However, Code section 6103 allows or requires the Internal Reve- nue Service to disclose or give the infor- mation shown on your tax return to others as described in the Code. For example, we may disclose your tax information to the Department of Justice to enforce the tax laws, both civil and criminal, and to cities, states, the District of Columbia, and U.S. commonwealths or possessions to carry out their tax laws. We may dis- close your tax information to the Depart- ment of Treasury and contractors for tax administration purposes; and to other per- sons as necessary to obtain information needed to determine the amount of or to collect the tax you owe. We may disclose your tax information to the Comptroller General of the United States to permit the Comptroller General to review the Inter- nal Revenue Service. We may disclose your tax information to committees of Congress; federal, state, and local child support agencies; and to other federal agencies for the purposes of determining entitlement for benefits or the eligibility for and the repayment of loans. We may also disclose this information to other countries under a tax treaty, to federal and state agencies to enforce federal nontax criminal laws, or to federal law enforce- ment and intelligence agencies to combat terrorism.

Please keep this notice with your re- cords. It may help you if we ask you for other information. If you have questions about the rules for filing and giving infor- mation, please call or visit any Internal Revenue Service office.

We Welcome Comments on Forms We try to create forms and instructions that can be easily understood. Often this is difficult to do because our tax laws are very complex. For some people with in- come mostly from wages, filling in the forms is easy. For others who have busi- nesses, pensions, stocks, rental income, or other investments, it is more difficult.

If you have suggestions for making these forms simpler, we would be happy

to hear from you. You can email us at [email protected]. Please put “Forms Comment” on the subject line. You can also send us comments from www.irs.gov/ formspubs/. Click on “More Information” and then on “Comment on Tax Forms and Publications.” Or you can write to Inter- nal Revenue Service, Individual and Spe- cialty Forms and Publications Branch, SE:W:CAR:MP:T:I, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224. Do not send your return to this ad- dress. Instead, see the addresses at the end of these instructions.

Although we cannot respond individu- ally to each comment received, we do ap- preciate your feedback and will consider your comments as we revise our tax forms and instructions.

Estimates of Taxpayer Burden The table below shows burden estimates based on current statutory requirements as of January 2013, for taxpayers filing a 2012 Form 1040, 1040A, or 1040EZ tax return. Time spent and out-of-pocket costs are presented separately. Time bur- den is broken out by taxpayer activity, with recordkeeping representing the larg- est component. Out-of-pocket costs in- clude any expenses incurred by taxpayers to prepare and submit their tax returns. Examples include tax return preparation and submission fees, postage and photo- copying costs, and tax preparation soft- ware costs. While these estimates do not include burden associated with post-filing activities, IRS operational data indicate that electronically prepared and filed re- turns have fewer arithmetic errors, imply- ing lower post-filing burden.

Reported time and cost burdens are na- tional averages and do not necessarily re- flect a “typical” case. Most taxpayers ex- perience lower than average burden, with taxpayer burden varying considerably by taxpayer type. For instance, the estimated average time burden for all taxpayers fil- ing a Form 1040, 1040A, or 1040EZ is 13 hours, with an average cost of $210 per return. This average includes all associ- ated forms and schedules, across all prep- aration methods and taxpayer activities. The average burden for taxpayers filing Form 1040 is about 16 hours and $270;

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the average burden for taxpayers filing Form 1040A is about 7 hours and $90; and the average for Form 1040EZ filers is about 4 hours and $40.

Within each of these estimates there is significant variation in taxpayer activity. For example, nonbusiness taxpayers are expected to have an average burden of

about 8 hours and $120, while business taxpayers are expected to have an average burden of about 23 hours and $420. Simi- larly, tax preparation fees and other out-of-pocket costs vary extensively de- pending on the tax situation of the taxpay- er, the type of software or professional

preparer used, and the geographic loca- tion.

If you have comments concerning the time and cost estimates below, you can contact us at either one of the addresses shown under We Welcome Comments on Forms.

Estimated Average Taxpayer Burden for Individuals by Activity Average Time Burden (Hours)

Primary Form Filed or Type of Taxpayer

Percentage of Returns

Total Time*

Record Keeping

Tax Planning

Form Completion

and Submission

All Other

Average Cost

(Dollars)** . . . . . . . .

All taxpayers . . . . . . . . . . 100 13 6 2 4 1 $210 Primary forms filed

1040 . . . . . . . . . . . . 69 16 8 2 4 1 270 1040A . . . . . . . . . . . 19 7 3 1 3 1 90 1040EZ . . . . . . . . . . 12 4 1 *** 2 1 40

Type of taxpayer Nonbusiness**** . . . . 70 8 3 1 3 1 120 Business**** . . . . . . 30 23 13 3 6 1 420

*Detail may not add to total time due to rounding. **Dollars rounded to the nearest $10. ***Rounds to less than $1. ****You are considered a “business” filer if you file one or more of the following with Form 1040: Schedule C, C-EZ, E, or F or Form 2106 or 2106-EZ. You are considered a “nonbusiness” filer if you did not file any of those schedules or forms with Form 1040 or if you file Form 1040A or 1040EZ.

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Order Form for Forms and Publications

The most frequently ordered forms and publications are listed on the order form be- low. You will receive two copies of each form, one copy of the instructions, and one copy of each publication you order. To help reduce waste, please order only the items you need to prepare your return.

For faster ways of getting the items you need, go to www.irs.gov/formspubs. TIP

How To Use the Order Form Circle the items you need on the order form below. Use the blank spaces to order items not listed. If you need more space, attach a separate sheet of paper.

Print or type your name and address accurately in the space provided below to

ensure delivery of your order. Enclose the order form in an envelope and mail it to the IRS address shown here. You should receive your order within 10 business days after receipt of your request.

Do not send your tax return to the address shown here. Instead, see the ad- dresses at the end of these instructions.

Mail Your Order Form To: Internal Revenue Service 1201 N. Mitsubishi Motorway Bloomington, IL 61705-6613

▲ ▲

Circle the forms and publications you need. The instructions for any form you order will be included.

Cut here

Name

Postal mailing address

City

Order Form Please print.

Apt./Suite/Room

Foreign country

Daytime phone number

State ZIP code

International postal code

( )

Use the blank spaces to order items not listed.

Save Money and Time by Going Online! Download or order these and other tax products at www.irs.gov/formspubs

Schedule R (1040A or

1040)

2106

1040

1040A

Schedule SE (1040)

Pub. 590

8829

Schedule A (1040)

1040EZ

Pub. 1

Schedule 8812 (1040A or

1040)

Pub. 523

Pub. 910

Schedule C (1040)

1040-V

4506

Pub. 17

Pub. 526

Schedule D (1040)

1040X

Pub. 334

Pub. 527

4562 Schedule E

(1040)

5405

Pub. 463

Pub. 529

Schedule F (1040)

Pub. 505

Schedule EIC (1040A or

1040)

Pub. 596

8822

Schedule C-EZ (1040)

6251

8283

Pub. 501

Pub. 502 Pub. 550

Pub. 575

Pub. 554

Schedule H (1040)

Pub. 915

1040-ES (2013)

Schedule J (1040)

8606

8863

Pub. 972

Form 8949

8917

2441 Pub. 535

4506-T

Pub. 525

Pub. 5473903

Pub. 587

Pub. 551

Pub. 583

Pub. 946

4868

4684

Pub. 4681

Schedule B (1040A or

1040)

Pub. 970

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Major Categories of Federal Income and Outlays for Fiscal Year 2011 Income and Outlays. These pie charts show the relative sizes of the major categories of federal income and outlays for �scal year 2011.

Income Outlays Personal income

taxes 30%

Excise, customs, estate, gift, and miscellaneous

taxes 6%

Corporate income taxes

5%

Social security, Medicare, and unemployment and other

retirement taxes 23%

Law enforcement and general government

2%

Social security, Medicare, and other

retirement 1 37%

National defense, veterans, and foreign

affairs 2 24%

Net interest on the debt

6%

Physical, human, and community development 3

8%

Social programs 4

23%

Borrowing to cover de�cit

36%

On or before the first Monday in February of each year the President is required by law to submit to the Congress a budget proposal for the fiscal year that begins the following October. The budget plan sets forth the President's proposed receipts, spending, and the surplus or deficit for the Federal government. The plan in- cludes recommendations for new legisla- tion as well as recommendations to change, eliminate, and add programs. Af- ter receipt of the President's proposal, the Congress reviews the proposal and makes changes. It first passes a budget resolution setting its own targets for receipts, out- lays, and surplus or deficit. Next, individ- ual spending and revenue bills that are consistent with the goals of the budget resolution are enacted.

In fiscal year 2011 (which began on October 1, 2010, and ended on September

30, 2011), Federal income was $2.303 trillion and outlays were $3.603 trillion, leaving a deficit of $1.3 trillion.

Footnotes for Certain Federal Outlays

1. Social security, Medicare, and other retirement: These programs pro- vide income support for the retired and disabled and medical care for the elderly.

2. National defense, veterans, and foreign affairs: About 20% of outlays were to equip, modernize, and pay our armed forces and to fund national defense activities; about 3% were for veterans benefits and services; and about 1% were for international activities, including mili- tary and economic assistance to foreign

countries and the maintenance of U.S. embassies abroad.

3. Physical, human, and communi­ ty development: These outlays were for agriculture; natural resources; environ- ment; transportation; aid for elementary and secondary education and direct assis- tance to college students; job training; de- posit insurance, commerce and housing credit, and community development; and space, energy, and general science pro- grams.

4. Social programs: About 15% of total outlays were for Medicaid, food stamps, temporary assistance for needy families, supplemental security income, and related programs; and the remaining outlays were for health research and pub- lic health programs, unemployment com- pensation, assisted housing, and social services.

Note. The percentages shown here exclude undistributed offsetting receipts, which were $86 billion in fiscal year 2011. In the budget, these receipts are offset against spending in figuring the outlay totals shown above. These receipts are for the U.S. Government's share of its employee retirement programs, rents and royalties on the Outer Continental Shelf, and proceeds from the sale of assets.

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2012 Tax Rate Schedules

The Tax Rate Schedules are shown so you can see the tax rate that applies to all levels of taxable income. Do not use them to �gure your tax. Instead, see the instructions for line 44.

Schedule Z—If your �ling status is Head of household

Schedule X—If your �ling status is Single

The tax is:If your taxable income is: of the

amount over—

But not over—Over—

Schedule Y-2—If your �ling status is Married filing separately

Schedule Y-1—If your �ling status is Married filing jointly or Qualifying widow(er)

The tax is:If your taxable income is: of the

amount over—

But not over—Over—

The tax is:If your taxable income is: of the

amount over—

But not over—Over—

The tax is:If your taxable income is: of the

amount over—

But not over—Over—

CAUTION

$0

8,700

35,350

85,650

178,650

388,350

$8,700

35,350

85,650

178,650

388,350

$0

8,700

35,350

85,650

178,650

388,350

$0

17,400

70,700

142,700

217,450

388,350

$0

8,700

35,350

71,350

108,725

194,175

$0

12,400

47,350

122,300

198,050

388,350

$17,400

70,700

142,700

217,450

388,350

$8,700

35,350

71,350

108,725

194,175

$12,400

47,350

122,300

198,050

388,350

$0

17,400

70,700

142,700

217,450

388,350

$0

8,700

35,350

71,350

108,725

194,175

$0

12,400

47,350

122,300

198,050

388,350

10%

$870.00 + 15%

4,867.50 + 25%

17,442.50 + 28%

43,482.50 + 33%

112,683.50 + 35%

10%

$1,740.00 + 15%

9,735.00 + 25%

27,735.00 + 28%

48,665.00 + 33%

105,062.00 + 35%

10%

$870.00 + 15%

4,867.50 + 25%

13,867.50 + 28%

24,332.50 + 33%

52,531.00 + 35%

10%

$1,240.00 + 15%

6,482.50 + 25%

25,220.00 + 28%

46,430.00 + 33%

109,229.00 + 35%

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Index to Instructions

A Address change . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Adjusted gross income . . . . . . . . . . . . . . . . . . 30, 37 Adoption expenses:

Employer-provided benefits for . . . . . . . . . . . 20 Aliens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Alimony paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Alimony received . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Alternative minimum tax . . . . . . . . . . . . . . . . . . 42 Amended return . . . . . . . . . . . . . .. . . . . . . . . . . . . . 93 Amount you owe . . . . . . . . . . . . . . . . . . . . . . . . 75, 77 Annuities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25, 28 Archer MSAs . . . . . . . . . . . . . . . . . . . . . . . . . . . 28, 46 Attachments to the return . . . . . . . . . . . . . . . . . . 78

B Bankruptcy cases, chapter 11 . . . . . . . . . . . . . . 20 Blindness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37, 39

C Capital gain distributions . . . . . . . . . . . . . . . . . . 23 Child and dependent care expenses, credit

for . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 Child tax credits . . . . . . . . . . . . . . . . . . . . 16, 43, 73 Community property states . . . . . . . . . . . . . . . . 20 Contributions to reduce debt held by the

public . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93 Corrective distributions . . . . . . . . . . . . . . . . . . . . 21

D Daycare center expenses . . . . . . . . . .. . . . . . . . . . 42 Death of a taxpayer . . . . . . . . . . . . . . . . . . . . . . . . 93 Death of spouse . . . . . . . . . . . . . . . . . . . . . . . . . 15, 93 Dependent care benefits . . . . . . . . . . . . . . . . . . . . 20 Dependents:

Exemptions for . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Standard deduction . . . . . . . . . . . . . . . . . . . . . . 39

Direct deposit of refund . . . . . . . . . . . . . . . . . 74, 75 Disclosure, Privacy Act, and Paperwork

Reduction Act Notice . . . . . . . . . . . . . . . . . . 101 Dividends:

Nondividend distributions . . . . . . . . . . . . . . . . 21 Ordinary dividends . . . . . . . . . . . . . . . . . . . . . . 21 Qualified dividends . . . . . . . . . . . . . . . 22, 38, 41

Domestic production activities deduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

Dual­status aliens . . . . . . . . . . . . . . . . . . . . . . . . 6, 13

E Earned income credit (EIC) . . . . .. . . . . 48, 56, 72

Combat pay, nontaxable . . . . . . . . . . . . . . . . . 50 Education:

Credits . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . 42, 73 Expenses . . . . . . . . . . . . . . . . . . . . . . . . 35, 42, 73 Recapture of education credits . . . . . . . . . . . . 38 Savings accounts . . . . . . . . . . . . . . . . . . . . . 28, 46

Educator expenses . . . . . . . . . . . . .. . . . . . . . . . . . . 30 Elderly persons:

Credit for . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . 45 Standard deduction . . . . . . . . . . . . . . . . . . . . . . 39

Electric vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 Electronic filing

(e­file) . . . . . . . . . . . . . . . . 3, 10, 74, 75, 78, 100 Estimated tax . . . . . . . . . . . .. . . . . . . . . . . . 47, 76, 92 Excess salary deferrals . . . . . . . . . . . . . . . . . . . . . 21

Excess social security and tier 1 RRTA tax withheld . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73

Exemptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Expired tax benefits . . . . . . . . . . . . . . . . . . . . . . . . . 5 Extension of time to file . . . . . . . . . . . . . . . . . . 6, 73

F Filing requirements . . . . . . . . . . . . . . . . . . . . . . . . 10 Filing status, which box to check . . . . . . . . 12, 14 Foreign accounts and trusts . . . . . . . . . . . . . . . . 20 Foreign­source income . . . . . . . . . . .. . . . . . . . . . . 20 Foreign tax credit . . . . . . . . . . . . . . . . . . . . . . . . . . 42 Forms, how to get . . . . . . . . . . . . .. . . . . . . . . . . . . 100 Forms W­2, 1098, and 1099—where to report

certain items from . . . . . . . . . . . . . . . . . . . . . . 10 Form W­2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Free tax help . . . . . . . . . . . . . . . . . . . . . . . . . . 94, 100

G Gambling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Golden parachute payments . . . . . . . . . . . . . . . . 47 Group­term life insurance, uncollected tax

on . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

H Head of household . . . . . . . . . . . . .. . . . . . . . . . . . . 13 Health insurance deduction,

self­employed . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 Health savings accounts . . . . . . .. . . . . . . 28, 31, 46 Homebuyer credit, first­time . . . . . . . . . . . . 46, 73 Household Employment Taxes . . . . . . .. . . . . . . 46 How to comment on forms . . . . . . . . . . . . . . . . 101

I Identity Protection PIN . . . . . . . . . . . . . . . . . . . . 78 Identity theft . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92 Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20, 28 Income tax withholding (federal) . . . . . . . . 47, 92 Individual retirement arrangements (IRAs):

Contributions to (line 32) . . . . . . . . . . . . . 32, 34 Credit for contributions to . . . . . . . . . . . . . . . . 42 Distributions from (lines 15a and 15b) . . . . 24 Nondeductible contributions to . . . . 24, 32, 34

Individual taxpayer identification numbers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Injured spouse . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . 73 Innocent spouse relief . . . . . . . . . . . . . . . . . . . . . . 92 Installment payments . . . . . . . . . . . . . . . . . . . 76, 99 Interest income:

Taxable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Tax-exempt . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . 21

Interest on taxes . . . . . . . . . . . . . .. . . . . . . . . . . . . . 95 Itemized deductions or standard

deduction . . . . . . . . . . . . . . . . . . . . . . . . . . . 37, 39

J Jury duty pay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

L Line instructions for Form 1040 . . . . . . . . . . . . 78 Living abroad, U.S. citizens and resident

aliens . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . 6, 20 Long­term care insurance . . . . . . . . . . . . . . . . . . 31 Lump­sum distributions . . . . . . . . . . . . . . . . . . . 28

M Married persons:

Filing joint returns . . . . . . . . . . . . . . . . . . . . . . . 13 Filing separate returns . . . . . . . . . .. . . . . . . . . . 13 Living apart . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Mileage rates, standard . . . . . . . . . . .. . . . . . . . . . . 5 Mortgage interest credit . . . . . . . . . . . . . . . . . . . 45 Moving expenses . . . . . . . . . . . . .. . . . . . . . . . . . . 5, 31

N Name change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Nonresident aliens . . . . . . . . . .. . . . . . . . . . 6, 12, 13

O Offsets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 Order form for forms and publications . . . . 103 Other income . . . . . . . . . . . . . . . . . . . . . . . . . . . 28, 30 Other taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45, 46

P Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47, 73 Pay taxes electronically (e­pay) . . . . . . . . . . . . . 75 Penalty:

Early withdrawal of savings . . . . . . . . . . . . . . 32 Estimated tax . . . . . . . . . . . . .. . . . . . . . . . . . . 76, 77 Others (including late filing and late

payment) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95 Penalty on early withdrawal of savings . . .. . . 32 Pensions and annuities . . . . . . . . . . . . . . . . . . 25, 28 Presidential election $3 check­off . . . . . . . . . . . 12 Private delivery services . . . . . . . . . . . . . . . . . . . . 6 Publications, how to get . . . . . . . . . .. . . . . . . . . . 100 Public debt, gift to reduce the . . . . . . . . . . . . . . 93

Q Qualified dividends . . . . . . . . . . . . . . . . . . . . . 38, 41 Qualified dividends and capital gain tax

worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . 38, 41 Qualified retirement plans, deduction

for . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 Qualified tuition program earnings . . . . . . 28, 46

R Railroad retirement benefits:

Treated as a pension . . . . . . . . . . .. . . . . . . . . . . 25 Treated as social security . . . . . . . . . . . . . . . . . 28

Records, how long to keep . . . . . . . . . . . . . . . . . . 93 Refund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73, 75 Refund information . . . . . . . . . . . . . . . . . . . . . . . . 96 Refund offset . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73 Refunds, credits, or offsets of state and local

income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Reservists, expenses of . . . . . . . . . . .. . . . . . . . . . . 30 Resident aliens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Residential energy efficient property

credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 Retirement plan deduction,

self­employed . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 Retirement savings contributions credit . . . . 42 Rights of taxpayers . . . . . . . . . . . . . . . . . . . . . . . . 92 Rollovers . . . . . . . . . . . . . . . . . . . . . . . . . . . 24, 26, 28 Roth IRAs . . . . . . . . . . . . . . . . . . . . . . . . . . 24, 26, 32 Rounding off to whole dollars . . . . . . . . . . . . . . 20

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S Saver's credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 Scholarship and fellowship grants . . . . . . . . . . 21 Self­employment tax:

Deduction for one-half of . . . . . . . . . . . . . . . . 31 Signing your return . . . . . . . . . . . . . . . . . . . . . . . . 77 Single person . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Social security and equivalent railroad

retirement benefits . . . . . . . . . . . . . . . . . . 28, 29 Social security number . . . . . . . . . . . . . . . . . . . . . 12 Standard deduction or itemized

deductions . . . . . . . . . . . . . .. . . . . . . . . . . . . . 37, 39 State and local income taxes, taxable refunds,

credits, or offsets of . . . . . . . . . . . . . . . . . . . . . 22 Statutory employees . . . . . . . . . . . . . . . . . . . . . . . 21 Student loan interest deduction . . . . . . . . . . . . 36

T Tax and credits . . . . . . . . . . . . . . . . . . . . . . . . . 37, 46

Figured by the IRS . . . . . . . . . . . . . . . . . . . 38, 51

Other taxes: Alternative minimum tax . . . . . . .. . . . . . . 42 IRAs and other tax-favored

accounts . . . . . . . . . . . . .. . . . . . . . . . . . . 46 Lump-sum distributions . . . . . . . . . . . . . . 28 Recapture . . . . . . . . . . . . . .. . . . . . . . . . . . . . 46

Tax computation worksheet . . . . . . . . . . . . . . . . 91 Tax Counseling for the Elderly (TCE) . . . . 3, 94 Taxpayer Advocate Service (TAS) . . . . . . . . . . . 4 Tax rate schedules . . . . . . . . . . . . . . . . . . . . . . . . 105 Tax table . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79 Telephone assistance:

Federal tax information . . . . . . . . . . . . . . . . . . 99 TeleTax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97, 98

Third party designee . . . . . . . . . . . . . . . . . . . . . . . 77 Tip income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20, 45 Tips reported to employer, uncollected tax

on . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 Tuition and fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 Tuition program earnings . . . . . . . .. . . . . . . . 28, 46

U Unemployment compensation . . . . . . . . . . . . . . 28

V Volunteer Income Tax Assistance Program

(VITA) . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . 3, 94

W What's new . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 What if you cannot pay? . . . . . . . . . . . . . . . . 76, 99 When and where should you file? . . . . . .. . . . . . 6 Who must file . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . 7, 8 Who should file . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . 6 Widows and widowers, qualifying . . . . . . . . . . 14 Winnings, prizes, gambling, and lotteries (other

income) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Withholding, federal income tax . . . .. . . . . 47, 92

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Where Do You File?

Mail your return to the address shown below that applies to you. If you want to use a private delivery service, see Private Delivery Services under Filing Requirements, earlier.

TIP Envelopes without enough postage will be returned to you by the post office. Your envelope may need additional postage if it contains more than five pages or is oversized (for example, it is over 1 4″ thick). Also, include your complete return address.

THEN use this address if you:

IF you live in... Are not enclosing a check or

money order... Are enclosing a check or

money order...

Florida, Louisiana, Mississippi, Texas Department of the Treasury Internal Revenue Service Austin, TX 73301-0002

Internal Revenue Service P.O. Box 1214 Charlotte, NC 28201-1214

Alaska, Arizona, California, Colorado, Hawaii, Idaho, Nevada, New Mexico, Oregon, Utah, Washington, Wyoming

Department of the Treasury Internal Revenue Service Fresno, CA 93888-0002

Internal Revenue Service P.O. Box 7704 San Francisco, CA 94120-7704

Arkansas, Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Montana, Nebraska, North Dakota, Ohio, Oklahoma, South Dakota, Wisconsin

Department of the Treasury Internal Revenue Service Fresno, CA 93888-0002

Internal Revenue Service P.O. Box 802501 Cincinnati, OH 45280-2501

Alabama, Georgia, Kentucky, Missouri, New Jersey, North Carolina, South Carolina, Tennessee, Virginia

Department of the Treasury Internal Revenue Service Kansas City, MO 64999-0002

Internal Revenue Service P.O. Box 931000 Louisville, KY 40293-1000

Connecticut, Delaware, District of Columbia, Maine, Maryland, Massachusetts, New Hampshire, New York, Pennsylvania, Rhode Island, Vermont, West Virginia

Department of the Treasury Internal Revenue Service Kansas City, MO 64999-0002

Internal Revenue Service P.O. Box 37008 Hartford, CT 06176-0008

A foreign country, U.S. possession or territory*, or use an APO or FPO address, or file Form 2555, 2555-EZ, 4563, or 8891, or are a dual-status alien

Department of the Treasury Internal Revenue Service Austin, TX 73301-0215

Internal Revenue Service P.O. Box 1303 Charlotte, NC 28201-1303

*If you live in American Samoa, Puerto Rico, Guam, the U.S. Virgin Islands, or the Northern Mariana Islands, see Pub. 570.

-108-

Userid: CPM Schema: instrx Leadpct: 100% Pt. size: 9 Draft Ok to PrintAH XSL/XML Fileid: … ions/I8949/2012/B/XML/Cycle02/source (Init. & Date) _______ Page 1 of 7 13:14 - 11-Apr-2013 The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.

2012 Instructions for Form 8949 Sales and Other Dispositions of Capital Assets

Department of the Treasury Internal Revenue Service

Section references are to the Internal Revenue Code unless otherwise noted.

Future Developments For the latest information about developments related to Form 8949 and its instructions, such as legislation enacted after they were published, go to www.irs.gov/form8949.

What's New Corporations and partnerships. The use of Form 8949 by corporations and partnerships is new. Many transactions that, in previous years, would have been reported by corporations and partnerships on Schedule D or Schedule D-1 must be reported on Form 8949 if they have to be reported on a 2012 form. For business entities meeting certain criteria, an exception to the normal requirements for completing Form 8949 has been provided. See Exception 2 under the instructions for lines 1 and 3.

General Instructions File Form 8949 with the Schedule D for the return you are filing. This includes Schedule D of Forms 1040, 1065, 1065-B, 8865, 1120, 1120S, 1120-C, 1120-F, 1120-FSC, 1120-H, 1120-IC-DISC, 1120-L, 1120-ND, 1120-PC, 1120-POL, 1120-REIT, 1120-RIC, 1120-SF, and certain Forms 990-T, but not Form 1041. Complete Form 8949 before you complete line 1, 2, 3, 8, 9, or 10 of Schedule D.

Purpose of Form Use Form 8949 to report sales and exchanges of capital assets. Form 8949 allows you and the IRS to reconcile amounts that were reported to you and the IRS on Form 1099-B or 1099-S (or substitute statement) with the amounts you report on your return. If you received Form 1099-B or 1099-S (or substitute statement), always report the proceeds (sales price) shown on that form (or statement) in column (d) of Form 8949. If Form 1099-B (or substitute statement) shows that the cost or other basis was reported to the IRS, always report the basis shown on that form (or statement) in column (e). If any correction or adjustment to these amounts is needed, make it in column (g). See How To Complete Form 8949, Columns (f) and (g), later, for details about these adjustments.

Individuals. Individuals use Form 8949 to report:

The sale or exchange of a capital asset not reported on another form or schedule,

Gains from involuntary conversions (other than from casualty or theft) of capital assets not held for business or profit, and

Nonbusiness bad debts. Corporations and partnerships. Corporations and partnerships use Form 8949 to report:

The sale or exchange of a capital asset not reported on another form or schedule,

Nonbusiness bad debts, and Undistributed long-term capital gains

from Form 2439. Electing large partnerships and

corporations also use Form 8949 to report their share of gain or (loss) from a partnership, S corporation, estate or trust. Schedule D. Use Schedule D for the following purposes.

To figure the overall gain or loss from transactions reported on Form 8949.

To report a gain from Form 6252 or Part I of Form 4797.

To report a gain or loss from Form 4684, 6781, or 8824.

To report capital gain distributions not reported directly on Form 1040, line 13 (or effectively connected capital gain distributions not reported directly on Form 1040NR, line 14).

To report a capital loss carryover from the previous tax year to the current tax year.

To report your share of a gain or (loss) from a partnership, S corporation, estate or trust. (However, electing large partnerships and corporations report this type of gain or (loss) on Form 8949.)

Individuals also use Schedule D to report undistributed long-term capital gains from Form 2439. Additional information. See the instructions for the Schedule D you are filing for detailed information about the following.

Other forms you may have to file. The definition of capital asset. Reporting capital gain distributions,

undistributed capital gains, the sale of a main home, the sale of capital assets held for personal use, or the sale of a partnership interest.

Capital losses, nondeductible losses, and losses from wash sales.

Traders in securities. Short sales. Gain or loss from options. Installment sales. Demutualization of life insurance

companies. Exclusion or rollover of gain from the

sale of qualified small business stock. Any other rollover of gain, such as gain

from the sale of publicly traded securities. Exclusion of gain from the sale of DC

Zone assets or qualified community assets.

Certain other items that get special treatment.

Special reporting rules for corporations and partnerships in certain situations.

For more information about reporting on Forms 6252, 4797, 4684, 6781, and 8824, see the instructions for those forms. See Pub. 544 and Pub. 550 for more details. Basis and Recordkeeping Basis is the amount of your investment in property for tax purposes. The basis of property you buy is usually its cost. You need to know your basis to figure any gain or loss on the sale or other disposition of the property. You must keep accurate records that show the basis and, if applicable, adjusted basis of your property. Your records should show the purchase price, including commissions; increases to basis, such as the cost of improvements; and decreases to basis, such as depreciation, nondividend distributions on stock, and stock splits.

For more information on basis, see the instructions for column (e), later, and these publications.

Pub. 550, Investment Income and Expenses (Including Capital Gains and Losses).

Pub. 551, Basis of Assets. If you lost or did not keep records to

determine your basis in securities, contact your broker for help.

The IRS partners with companies that offer Form 8949 software that can import trades from many

brokerage firms and accounting software to help you keep track of your adjusted basis in securities. To find out more, go to www.irs.gov/efile.

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Short Term or Long Term Separate your capital gains and losses according to how long you held or owned the property.

The holding period for short-term capital gains and losses is 1 year or less. Report these transactions on Part I of Form 8949.

The holding period for long-term capital gains and losses is more than 1 year. Report these transactions on Part II of Form 8949.

To figure the holding period, begin counting on the day after you received the property and include the day you disposed of it.

Generally, if you disposed of property that you acquired by inheritance, report the disposition as a long-term gain or loss regardless of how long you held the property. However, if you acquired the property from someone who died in 2010 and the executor of the estate made the election to file Form 8939, see Pub. 4895.

A nonbusiness bad debt must be treated as a short-term capital loss. See Pub. 550 for what qualifies as a nonbusiness bad debt and how to enter it on Part I of Form 8949. Corporation's or Electing Large Partnership's Gains and Losses from Partnerships, Estates, or Trusts Report a corporation's or electing large partnership's share of capital gains and losses from investments in partnerships, estates, or trusts on the appropriate Part of Form 8949. Report a net short-term capital gain or (loss) on Part I (with box C checked) and a net long-term capital gain or (loss) on Part II (with box C checked). In column (a), enter “From Schedule K-1 (Form 1065),” “From Schedule K-1 (Form 1065-B),” or “From Schedule K-1 (Form 1041),” whichever applies; enter the gain or (loss) in column (h); and leave all other columns blank.

Specific Instructions Report short-term gains and losses on Part I. Report long-term gains and losses on Part II.

Lines 1 and 3 Enter all sales and exchanges of capital assets, including stocks, bonds, etc., and real estate (if not reported on Form 4684, 4797, 6252, 6781, or 8824). Include these transactions even if you did not receive a Form 1099-B or 1099-S (or substitute statement) for the transaction. However, if the property you sold was your main

home, see Sale of Your Home in the Instructions for Schedule D (Form 1040).

Enter the details of each transaction on a separate row (unless one of the Exceptions to reporting each transaction on a separate row described later applies to you). Use as many Parts I and Parts II of Form 8949 as you need.

Use a separate Part I for each of the following types of short-term transactions.

1. Short-term transactions reported to you on Form 1099-B (or substitute statement) with an amount shown for cost or other basis unless the statement indicates that amount was not reported to the IRS. Check box A at the top of this Part I. If box 6b of Form 1099-B is not checked, which means basis was not reported to the IRS (or if your substitute statement shows cost or other basis for the transaction but indicates it was not reported to the IRS), report that transaction on Part I with box B, not box A, checked (see 2 below).

2. Short-term transactions reported to you on Form 1099-B (or substitute statement) without an amount shown for cost or other basis. Check box B at the top of this Part I. If box 6b of Form 1099-B is not checked, which means basis was not reported to the IRS (or if your substitute statement shows cost or other basis for the transaction but indicates it was not reported to the IRS), report that transaction on Part I with box B, not box A, checked.

3. Short-term transactions for which you cannot check box A or B because you did not receive a Form 1099-B (or substitute statement). Check box C at the top of this Part I.

Use a separate Part II for each of the following types of long-term transactions.

1. Long-term transactions reported to you on Form 1099-B (or substitute statement) with an amount shown for cost or other basis unless the statement indicates that amount was not reported to the IRS. Check box A at the top of this Part II. If box 6b of Form 1099-B is not checked, which means basis was not reported to the IRS (or if your substitute statement shows cost or other basis for the transaction but indicates it was not reported to the IRS), report that transaction on Part II with box B, not box A, checked (see 2 below).

2. Long-term transactions reported to you on Form 1099-B (or substitute statement) without an amount shown for cost or other basis. Check box B at the top of this Part II. If box 6b of Form 1099-B is not checked, which means basis was not reported to the IRS (or if your substitute statement shows cost or other basis for the transaction but indicates it was not reported to the IRS), report that

transaction on Part II with box B, not box A, checked.

3. Long-term transactions for which you cannot check box A or B because you did not receive a Form 1099-B (or substitute statement). Check box C at the top of this Part II.

Include on each Part I or Part II of Form 8949 only capital gains and losses described in the text for the box you check (A, B, or C) on that Part. You do not need to complete and file an entire copy of Form 8949 (Part I and Part II) if you have only gains and losses that fit into a single category (i.e., they are all either short-term or long-term and you can check a single box to describe all of them). In that case, you must complete and file either Part I or Part II and check the box that describes the gains and losses. If your gains and losses do not fit into a single category (i.e., some are short-term and some are long-term and/or some are described by the text for one box and some are described by the text for another box), complete a separate Part I or Part II for each category. Complete as many copies of Part I and Part II as you need to report each category of your gains and losses. Check only one box on each Part I and Part II. For example, if you check box A in one Part I, include on that Part I only short-term gains and losses from transactions reported to you on a statement showing that basis was reported to the IRS.

Include on your Schedule D the totals from all your Parts I and Parts II. Form 8949 and Schedule D explain exactly how to do this. Exceptions to reporting each transac­ tion on a separate row. There are two exceptions to the rule that you must report each of your transactions on a separate row of Part I or Part II.

Exception 1. For 2012, instead of reporting each of your transactions on a separate row of Part I or Part II, you can report them on an attached statement containing all the same information as Parts I and II and in a similar format (i.e., description of property, dates of acquisition and disposition, proceeds, basis, adjustment and code(s), and gain or (loss)). Use as many attached statements as you need. Enter the combined totals from all your attached statements on Parts I and II with the appropriate box checked. For example, report on Part I with box A checked all short-term gains and losses from transactions your broker reported to you on a statement showing that the basis of the asset sold was reported to the IRS. Enter the name of the broker followed by the words “see attached statement” in column (a). Leave columns (b) and (c)

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blank. Enter “M” in column (f). If other codes also apply, enter all of them in column (f). If you have statements from more than one broker, report the totals from each broker on a separate row.

Do not enter “Available upon request” and summary totals in lieu of reporting the details of each transaction on Part I or II or attached statements.

Exception 2. You may enter summary totals instead of reporting the details of each transaction on a separate row of Part I or II or on attached statements if:

1. You must report more than five transactions for that Part, and

2. You file Form 1120S, 1065, or 1065-B or are a taxpayer exempt from receiving Form 1099-B, such as a corporation or exempt organization, under Regulations section 1.6045-1(c)(3)(i)(B).

If this exception applies to you, enter the summary totals on line 1 or line 3 with the correct box checked. Enter “Available upon request” in column (a). Leave columns (b) and (c) blank. Enter “M” in column (f). If other codes also apply, enter all of them in column (f).

Do not use a separate row for the totals from each broker. Instead, enter the summary totals from all brokers on a single row of Part I or Part II with the appropriate box checked. E­file. If you e-file your return but choose not to report each transaction on a separate row on the electronic return, you must either (a) include Form 8949 as a PDF attachment to your return or (b) attach Form 8949 to Form 8453 (or the appropriate form in the Form 8453 series) and mail the forms to the IRS. You can attach one or more statements containing all the same information as Form 8949, instead of attaching Form 8949, if the statements are in a format similar to Form 8949. Charitable gift annuity. If you are the beneficiary of a charitable gift annuity and receive a Form 1099-R showing an amount in box 3, report the box 3 amount on a Part II with box C checked. Enter “Form 1099-R” in column (a). Enter the box 3 amount in column (d). Also complete column (h). Form 2439. Corporations and partnerships report undistributed long-term capital gains from Form 2439 on a Part II with box C checked. Enter “From Form 2439” in column (a), enter the gain in column (h), and leave all other columns blank. Individuals report undistributed long-term capital gains from Form 2439 on line 11 of Schedule D (Form 1040). Nondividend distributions. Distributions from a corporation that are a return of your cost (or other basis) are not

taxed until you recover your cost (or other basis). Reduce your cost (or other basis) by these distributions. After you get back all of your cost (or other basis), enter the name of the payer of any later nondividend distributions in column (a) on a Part I or Part II (depending on how long you held the stock) with box C checked. Enter the taxable part of the distribution in columns (d) and (h). Each payer of a nondividend distribution should send you a Form 1099-DIV showing the amount of the distribution in box 3. Other gains or losses where sales price or basis is not known. If you have another gain or loss for which you do not know the sales price or basis (such as a long-term capital gain from Form 8621), enter a description of the gain or loss in column (a) on a Part I or Part II (depending on how long you held the property) with box C checked. If you have a gain, enter it in columns (d) and (h). If you have a loss, enter it in columns (e) and (h). Complete any other columns you can. Rounding Off to Whole Dollars You can round off cents to whole dollars on Form 8949. If you do round to whole dollars, you must round all amounts. To round, drop cent amounts under 50 cents and increase cent amounts over 49 cents to the next dollar. For example, $1.49 becomes $1 and $1.50 becomes $2. Column (a)—Description of Property For stock, include the number of shares. You can use stock ticker symbols or abbreviations to describe the property as long as they are based on the descriptions of the property as shown on Form 1099-B or 1099-S (or substitute statement).

If you inherited the property from someone who died in 2010 and the executor of the estate made the election to file Form 8939, also enter “INH-2010” in column (a). Column (b)—Date Acquired Enter in this column the date you acquired the asset. Use the trade date for stocks and bonds traded on an exchange or over-the-counter market. For stock or other property sold short, enter the date you acquired the stock or property delivered to the broker or lender to close the short sale.

The date acquired for an asset you held on January 1, 2001, for which you made an election to recognize any gain in a deemed sale is the date of the deemed sale and reacquisition.

Generally, if you disposed of property that you acquired by inheritance, report the sale or exchange on Part II and enter “INHERITED” in column (b) instead of the date you acquired the property. However,

if you inherited the property from someone who died in 2010 and the executor made the election to file Form 8939, also see the instructions for column (a) and see Pub. 4895 to see whether you should report the sale or exchange on a Part I or a Part II.

If you sold a block of stock (or similar property) that you acquired through several different purchases, you may report the sale on one row and enter “VARIOUS” in column (b). However, you still must report the short-term gain or (loss) on the sale on Part I and the long-term gain or (loss) on Part II. Column (c)—Date Sold or Disposed Enter in this column the date you sold or disposed of the asset. Use the trade date for stocks and bonds traded on an exchange or over-the-counter market. For stock or other property sold short, enter the date you delivered the stock or property to the broker or lender to close the short sale. Column (d)—Proceeds (Sales Price) Follow the instructions below that apply to your transaction(s). You did not receive a Form 1099­B or 1099­S (or substitute statement). If you did not receive a Form 1099-B or 1099-S (or substitute statement) for a transaction, enter in column (d) the net proceeds. The net proceeds equal the gross proceeds minus any selling expenses (such as broker’s fees, commissions, and state and local transfer taxes) and adjusted for any option premiums (as instructed in Gain or Loss From Options in the instructions for Schedule D (Form 1040)). You received a Form 1099­B or 1099­S (or substitute statement). If you received a Form 1099-B or 1099-S (or substitute statement) for a transaction, enter in column (d) the proceeds (sales price) shown on the form or statement you received. If there are any selling expenses or option premiums that are not reflected on the form or statement you received (by an adjustment to either the proceeds or basis shown), enter “E” in column (f) and the necessary adjustment in column (g). See the example under Column (g)—Adjustments to Gain or Loss, later.

If the proceeds you received were more than shown on Form 1099-B or 1099-S (or substitute statement), enter the correct proceeds in column (d). This might happen if, for example, box 4 on Form 1099-S is checked.

You should not have received a Form 1099-B (or substitute statement) for a transaction merely representing the return of your original investment in a

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nontransferable obligation, such as a savings bond or a certificate of deposit. But if you did, report the proceeds (sales price) shown on Form 1099-B (or substitute statement) in both columns (d) and (e). Column (e)—Cost or Other Basis In general, the cost or other basis is the cost of the property plus purchase commissions and improvements, minus depreciation, amortization, and depletion. If you inherited the property, got it as a gift, or received it in a tax-free exchange or involuntary conversion or in connection with a “wash sale,” you may not be able to use the actual cost as the basis. If you do not use the actual cost, attach an explanation of your basis.

If you sold stock, adjust your basis by subtracting all the nondividend distributions you received before the sale. Also adjust your basis for any stock splits. See Pub. 550 for details.

If you elected to recognize gain on an asset held on January 1, 2001, your basis in the asset is its closing market price or fair market value, whichever applies, on the date of the deemed sale and reacquisition, whether the deemed sale resulted in a gain or an unallowed loss.

You can use the average basis method to determine the basis of shares of stock if the shares are identical to each other, you acquired them at different prices and left them in an account with a custodian or agent, and either:

They are shares in a mutual fund (or other regulated investment company (RIC)), or

You acquired them after 2010 in connection with a dividend reinvestment plan (DRP). Shares are identical if they have the same CUSIP number, except that shares of stock in a DRP are not identical to shares of stock that are not in a DRP, even if they have the same CUSIP number. If you are using the average basis method and received a Form 1099-B (or substitute statement) that shows an incorrect basis,

enter “B” in column (f), enter the basis shown on Form 1099-B (or substitute statement) in column (e), and see How To Complete Form 8949, Columns (f) and (g), later. For details on making the election and how to figure average basis, see Pub. 550 or Regulations section 1.1012-1(e).

The basis of property acquired by gift is generally the basis of the property in the hands of the donor. The basis of inherited property is generally the fair market value at the date of death. See Pub. 551 for details. However, if you sold property that you inherited from someone who died in 2010 and the executor made the election to file Form 8939, see Pub. 4895.

Increase the cost or other basis of an original issue discount (OID) debt instrument by the amount of OID that has been included in gross income for that instrument. See Pub. 550 for details.

If a charitable contribution deduction is allowable because of a bargain sale of property to a charitable organization, the adjusted basis for purposes of determining gain from the sale is the amount that has the same ratio to the adjusted basis as the amount realized has to the fair market value. See Pub. 544 for details.

For more details, see Pub. 551. Form 1099­B. If the property you sold was a covered security, its basis should be shown in box 3 of the Form 1099-B (or substitute statement) you received from your broker. Generally, a covered security is stock acquired after 2010 (after 2011 if in a mutual fund or other regulated investment company, or acquired through a dividend reinvestment plan).

If box 6a on Form 1099-B is checked, the property sold was not a covered security.

Enter the basis shown on Form 1099-B (or substitute statement) in column (e). If the basis shown on Form 1099-B (or substitute statement) is not correct, see How To Complete Form 8949, Columns (f) and (g), later, for the adjustment you must make.

If no basis is shown on Form 1099-B (or substitute statement), enter the correct basis of the property in column (e). Column (f)—Code In order to explain any adjustment to gain or loss in column (g), enter the appropriate code(s) in column (f). See How To Complete Form 8949, Columns (f) and (g), later. If more than one code applies, enter all the codes that apply in alphabetical order (for example, “BOQ”). Do not separate the codes by a space or comma. Column (g)—Adjustments to Gain or Loss Enter in this column any necessary adjustments to gain or loss. Enter negative amounts in parentheses. Also enter a code in column (f) to explain the adjustment. See How To Complete Form 8949, Columns (f) and (g), later.

More than one code. If you entered more than one code in column (f) on the same row, enter the net adjustment in column (g). For example, if one adjustment is $5,000 and another is ($1,000), enter $4,000 ($5,000 − $1,000).

Example. You sold your main home in 2012 for $320,000 and received a Form 1099-S showing the $320,000 gross proceeds. The home's basis was $100,000. You had selling expenses of $20,000. Under the tests described in Sale of Your Home in the Instructions for Schedule D (Form 1040), you can exclude the entire $200,000 gain from income. On Form 8949, Part II, check box C at the top. Complete columns (a), (b), and (c). Enter $320,000 in column (d) and $100,000 in column (e). Enter “EH” in column (f). In column (g), enter $220,000 ($20,000 selling expenses + $200,000 exclusion) as a negative number. Put it in parentheses to show it is negative. In column (h), enter -0- ($320,000 − $100,000 − $220,000). If this is your only transaction on this Part II, enter $320,000 in column (d) on line 10 of Schedule D (Form 1040), $100,000 in column (e), ($220,000) in column (g), and -0- in column (h).

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How To Complete Form 8949, Columns (f) and (g)

For most transactions, you do not need to complete columns (f) and (g) and can leave them blank. You may need to complete columns (f) and (g) if you got a Form 1099-B or 1099-S (or substitute statement) that is incorrect, if you are excluding or postponing a capital gain, if you have a disallowed loss, or in certain other situations. Details are in the table below. If you enter more than one code in column (f), see More than one code in the instructions for column (g).

IF . . . THEN enter this code in column

(f) . . . AND. . .

You received a Form 1099-B (or substitute statement) and the basis shown in box 3 is incorrect . . . . . . . . . . . . . . . . . . . . . . . . .

B

If box B is checked at the top of Part I or II, enter the correct basis in column (e), and enter -0- in column (g).

If box A is checked at the top of Part I or II, enter the basis shown on Form 1099-B (or substitute statement) in column (e), even though that basis is incorrect. Correct the error by entering an adjustment in column (g). To figure the adjustment needed, see the Worksheet for Basis Adjustments in Column (g). Also see Example 4—adjustment for incorrect basis in the instructions for column (h).

You received a Form 1099-B (or substitute statement) and the type of gain or loss (short term or long term) shown in box 1c is incorrect . . . . . . . . . . . . . . . . . . . . . . . . .

T Enter -0- in column (g). Report the gain or loss on the correct Part of Form 8949.

You received a Form 1099-B or 1099-S (or substitute statement) as a nominee for the actual owner of the property . . . . . . . . . . .

N

Report the transaction on Form 8949 as you would if you were the actual owner, but enter any resulting gain as a negative adjustment (in parentheses) in column (g) or any resulting loss as a positive adjustment in column (g). However, if you received capital gain distributions as a nominee, report them instead as described under Capital Gain Distributions in the Instructions for Schedule D (Form 1040).

You sold or exchanged your main home at a gain, must report the sale or exchange on Part II of Form 8949 (as explained in Sale of Your Home in the Instructions for Schedule D (Form 1040)), and can exclude some or all of the gain . . . . . . . . . . . . . . . . . . . . . . . . . .

H

Report the sale or exchange on Form 8949 as you would if you were not taking the exclusion. Then enter the amount of excluded (nontaxable) gain as a negative number (in parentheses) in column (g). See the example in the instructions for column (g).

You sold or exchanged qualified small business stock and can exclude part of the gain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Q

Report the sale or exchange on Form 8949 as you would if you were not taking the exclusion and enter the amount of the exclusion as a negative number (in parentheses) in column (g). However, if the transaction is reported as an installment sale, see Gain from an installment sale of QSB stock in the Instructions for Schedule D (Form 1040).

You can exclude all or part of your gain under the rules explained in the Schedule D instructions for DC Zone assets or qualified community assets . . . . . . . . . . . . . . . . . .

X Report the sale or exchange on Form 8949 as you would if you were not taking the exclusion. Then enter the amount of the exclusion as a negative number (in parentheses) in column (g).

You are electing to postpone all or part of your gain under the rules explained in the Schedule D instructions for any rollover of gain (for example, rollover of gain from QSB stock or publicly traded securities) . . . . . .

R

Report the sale or exchange on Form 8949 as you would if you were not making the election. Then enter the amount of postponed gain as a negative number (in parentheses) in column (g).

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IF . . . THEN enter this code in column

(f) . . . AND. . .

You have a nondeductible loss from a wash sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . W

Report the sale or exchange on Form 8949 and enter the amount of the nondeductible loss as a positive number in column (g). See the Schedule D instructions for more information about wash sales.

You have a nondeductible loss other than a loss indicated by code W . . . . . . . . . . . . . L

Report the sale or exchange on Form 8949 and enter the amount of the nondeductible loss as a positive number in column (g). See Nondeductible Losses in the Instructions for Schedule D (Form 1040).

You received a Form 1099-B or 1099-S (or substitute statement) for a transaction and there are selling expenses or option premiums that are not reflected on the form or statement by an adjustment to either the proceeds or basis shown . . . . . . . . . . . . . E

Enter in column (d) the proceeds shown on the form or statement you received. Enter in column (e) any cost or other basis shown on Form 1099-B (or substitute statement). In column (g), enter as a negative number (in parentheses) any selling expenses and option premium that you paid (and that are not reflected on the form or statement you received) and enter as a positive number any option premium that you received (and that is not reflected on the form or statement you received). For more information about option premiums, see Gain or Loss From Options in the Instructions for Schedule D (Form 1040).

You had a loss from the sale, exchange, or worthlessness of small business (section 1244) stock and the total loss is more than the maximum amount that can be treated as an ordinary loss . . . . . . . . . . . . . . . . . . . .

S

See Small Business (Section 1244) Stock in the Schedule D (Form 1040) instructions.

You disposed of collectibles (see the Schedule D instructions) . . . . . . . . . . . . . C

Enter -0- in column (g). Report the disposition on Form 8949 as you would report any sale or exchange.

You report multiple transactions on a single row as described in Exceptions to reporting each transaction on a separate row . . . . .

M See Exceptions to reporting each transaction on a separate row. Enter -0- in column (g) unless an adjustment is required because of another code.

You have an adjustment not explained earlier in this column . . . . . . . . . . . . . . . . . . . . . O

Enter the appropriate adjustment amount in column (g). See the instructions for column (g).

None of the other statements in this column apply . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Leave columns (f) and (g) blank.

Column (h)—Gain or (Loss) Figure gain or loss on each row. First, subtract the cost or other basis in column (e) from the proceeds (sales price) in column (d). Then take into account any adjustments in column (g). Enter the gain or (loss) in column (h). Enter negative amounts in parentheses.

Example 1—gain. Column (d) is $6,000 and column (e) is $2,000. Enter $4,000 in column (h).

Example 2—loss. Column (d) is $6,000 and column (e) is $8,000. Enter ($2,000) in column (h).

Example 3—adjustment. Column (d) is $6,000, column (e) is $2,000, and column (g) is ($1,000). Enter $3,000 in column (h).

Example 4—adjustment for incorrect basis. You sold stock for $1,000. You had owned the stock for 3 months. Your correct basis for the stock is $100, but you receive a Form 1099-B that shows your basis is $900 and shows your broker reported that basis to the IRS. Enter $900 on line 1 of the Worksheet for Basis Adjustments in Column (g). Enter $100 on line 2 of the worksheet. Since

line 1 is larger than line 2, leave line 3 blank and enter $800 ($900 − $100) as a positive number on line 4. Also enter $800 in column (g) of a Part I with box A checked at the top. Enter “B” in column (f). Enter $1,000 in column (d) and $900 in column (e). To figure your gain or loss, subtract $900 from $1,000. Combine the result, $100, with the $800 adjustment in column (g). Your gain is $900 ($100 + $800). Enter $900 in column (h).

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Worksheet for Basis Adjustments in Column (g) Keep for Your Records If the basis shown on Form 1099-B (or substitute statement) is not correct, do the following.

If the basis was not reported to the IRS, enter the correct basis in column (e) and enter -0- in column (g) (unless you must make an adjustment for some other reason).

If the basis was reported to the IRS, enter the reported basis shown on Form 1099-B (or substitute statement) in column (e) and use this worksheet to figure the adjustment to include in column (g). 1. Enter the cost or other basis shown on Form 1099-B (or substitute statement) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1. 2. Enter the correct cost or other basis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2. 3. If line 1 is larger than line 2, leave this line blank and go to line 4. If line 2 is larger than line 1, subtract line 1 from line 2. Enter

the result here and in column (g) as a negative number (in parentheses) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3. 4. If line 1 is larger than line 2, subtract line 2 from line 1. Enter the result here and in column (g) as a positive number . . . . . . 4.

Lines 2 and 4 The total of the amounts in column (h) of line 2 of all your Forms 8949 should equal the amount you get by combining columns (d), (e), and (g) on the corresponding line of Schedule D. For example, the total of the amounts in column (h) of line 2 of all

your Forms 8949 with box A checked should equal the amount you get by combining columns (d), (e), and (g) on line 1 of Schedule D.

The total of the amounts in column (h) of line 4 of all your Forms 8949 should equal the amount you get by combining

columns (d), (e), and (g) on the corresponding line of Schedule D. For example, the total of the amounts in column (h) of line 4 of all your Forms 8949 with box A checked should equal the amount you get by combining columns (d), (e), and (g) on line 8 of Schedule D.

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Department of the Treasury Internal Revenue Service

2012 Instructions for Schedule 8812 Child Tax Credit Use Part I of Schedule 8812 to document that any child for whom you entered an ITIN on Form 1040, line 6c; Form 1040A, line 6c; or Form 1040NR, line 7c; and for whom you also checked

the box in column 4 of that line, is a resident of the United States because the child meets the substantial presence test and is not otherwise treated as a nonresident alien.

Use Parts II–IV of Schedule 8812 to figure the additional child tax credit. The additional child tax credit may give you a refund even if you do not owe any tax.

Section references are to the Internal Revenue Code unless otherwise noted.

Future Developments For the latest information about developments related to Schedule 8812 and its instructions, such as legislation enacted after they were published, go to www.irs.gov/form1040.

What's New Schedule 8812 is new for 2012. Parts II–IV of Schedule 8812 replace Form 8812, Additional Child Tax Credit. Part I of this schedule is in- dependent of Parts II–IV. Depending on your circumstances, you may need to complete Part I, but not Parts II–IV; Parts II–IV, but not Part I; or both Part I and Parts II–IV.

General Instructions Substantial Presence Test (Part I) In general, to be a qualifying child for purposes of the child tax credit and additional child tax credit, the child must be a citizen, national, or resident of the United States. Use Part I of Schedule 8812 to document that any child for whom an IRS Individual Taxpayer Identification Number (ITIN) was entered on Form 1040, line 6c; Form 1040A, line 6c; or Form 1040NR, line 7c; and for whom the box in column 4 of that line was also checked, meets the substantial presence test and is not otherwise treated as a nonresident alien.

Note. A child who is a lawful permanent resident of the United States is eligible to obtain a social security number (SSN). Use an SSN to identify the child even if you obtained an ITIN for the child before the child became a lawful permanent resident.

To meet the substantial presence test, a child identified with an ITIN generally must be physically present in the United States on at least:

1. 31 days during 2012, and 2. 183 days during the 3-year period that includes 2012, 2011,

and 2010, counting:

a. All the days your child was present in 2012, and b. 1/3 of the days your child was present in 2011, and c. 1/6 of the days your child was present in 2010.

Not all days that your dependent is physically present in the United States count as days of presence for the sub­ stantial presence test. See Days of Presence in the United States in Pub. 519.

A child who is present in the United States for less than one-half of 2012 also must not have a closer connection to a foreign country. See Pub. 519 for more information. Also, see the chart, Is Your Dependent (Identified by an ITIN) Considered a Resident of the United States Un­ der the Substantial Presence Test, later.

Additional Child Tax Credit (Parts II– IV) All taxpayers should use Parts II–IV of Schedule 8812 to figure the additional child tax credit. If any of your dependents is a qualifying child for purposes of the child tax credit (whether identified by an ITIN or not), you may qualify for the additional child tax credit. Be- fore completing Parts II–IV of Schedule 8812, complete the Child Tax Credit Worksheet that applies to you. See the instructions for Form 1040, line 51; Form 1040A, line 33; or Form 1040NR, line 48. If you meet the condition given in the TIP at the end of the Child Tax Credit Worksheet, complete Parts II–IV of this schedule to figure the amount of any additional child tax credit you can claim.

Effect of Credit on Welfare Benefits Any refund you receive as a result of taking the additional child tax credit may not be counted as income when determining whether you or anyone else is eligible for certain welfare programs. These pro- grams include Temporary Assistance for Needy Families (TANF), Medicaid, Supplemental Security Income (SSI), Supplemental Nutri- tion Assistance Program (food stamps), and low-income housing. Check with your local benefits coordinator to find out if your refund will affect your benefits.

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Is Your Dependent (Identi�ed by an ITIN) Considered a Resident of the United States Under the Substantial Presence Test?

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Start here to determine your dependent’s status for 2012

Was your dependent physically present in the United States on at least 31 days during 2012?2

Was your dependent physically present in the United States on at least 183 days during the 3-year period consisting of 2012, 2011, and 2010, counting all days present in 2012, 1/3 the days of presence in 2011, and 1/6 the days of presence in 2010?2

Was your dependent physically present in the United States on at least 183 days during 2012?

For 2012, did your dependent have a tax home in a foreign country and a closer connection to that country than to the United States?

Your dependent is a resident alien for U.S. tax purposes.1

Your dependent is a nonresident alien for U.S. tax purposes.

Yes

Yes

Yes

Yes

No

No3

No

No

1 Despite meeting the substantial presence test, your dependent may still be considered a nonresident alien under an income tax treaty between the U.S. and your country. Check the provisions of the treaty carefully.

2 See Days of Presence in the United States in Pub. 519 for days that do not count as days of presence in the United States.

3 If your dependent was present in the United States for at least 31 consecutive days in 2012 and meets the substantial presence test for 2013, see First-Year Choice under Dual Status Aliens in Pub. 519 to determine if your dependent may be considered to be a resident of the United States for part of 2012 under this rule. An individual may make an election for a child who is a dependent if the individual may make the election on his or her own behalf, the child quali�es to make the election, and the child is not required to �le a United States income tax return for the year for which the election is effective.

Specific Instructions Part I Lines A through D. If you identified any of your dependents using an ITIN on your Form 1040, line 6c; Form 1040A, line 6c; or Form 1040NR, line 7c; and you also checked the box in column (4) of that line for that dependent, you must determine if that dependent meets the substantial presence test and is not otherwise treated as a nonresi- dent alien. Complete Line A for the first dependent listed on your Form 1040, line 6c; Form 1040A, line 6c; or Form 1040NR, line 7c, who has an ITIN and that you indicated qualified for the child tax credit by checking column (4). Use a separate line for each additional

child identified by an ITIN for whom you checked the box in column (4).

Do not complete a line in Part I for a child if: You identified that child with an SSN or adoption taxpayer iden-

tification number on the tax return, or You did not check the box in column 4 of line 6c on your Form

1040 or Form 1040A, or line 7c of your Form 1040NR. If you only check “No” on any line in Part I, your child tax credit

or additional child tax credit may be reduced or eliminated.

Child otherwise treated as a nonresident alien. Even if your child meets the substantial presence test, your child may still be trea-

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ted as a nonresident alien due to a tax treaty or because the child has a closer connection to another country. See Pub. 519 for more details.

If you must complete Part I for a child and that child meets the substantial presence test, but is still treated as a nonresident alien, check the “No” box for that child.

Special circumstances. Even if your child does not meet the substantial presence test, your child may meet an exception or be trea- ted as a resident of the United States in certain circumstances. If your child does not meet the substantial presence test, but one of the fol- lowing special circumstances applies, check both the "Yes" and "No" boxes for that child.

First-year election. If your child was present in the United States for at least 31 consecutive days in 2012 and meets the substantial pres- ence test for 2013, your child may be considered a resident of the Uni- ted States for part of 2012 if you make a valid election. See First­Year Choice under Dual Status Aliens in Pub. 519.

Child adopted by U.S. citizen or national. A child legally adop- ted by you or lawfully placed with you for legal adoption is not re- quired to meet the substantial presence test if you are a citizen or na- tional of the United States, and, for your tax year, the child has the same main home as you and is a member of your household.

More than four children. If you must complete Part I for more than four children, check the box following Line D. Use page 1 of an- other Schedule 8812 and reletter Lines A–D in Part I as E–H. Com- plete the additional Part I of Schedule 8812 and attach it to your Schedule 8812.

Parts II through IV Line 4a — Earned Income Chart. Use the chart above to determine the amount to enter on line 4a. Line 4b — Nontaxable Combat Pay. Enter on line 4b the total amount of nontaxable combat pay that you, and your spouse if filing jointly, received in 2012. This amount should be shown in Form W-2, box 12, with code Q. Line 7 — Railroad Employees. If you worked for a railroad, include the following taxes in the total on Schedule 8812, line 7.

Tier 1 tax withheld from your pay. This tax should be shown in box 14 of your Form(s) W-2 and identified as “Tier 1 tax.”

If you were an employee representative, 50% of the total tier 1 tax you paid for 2012.

Earned Income Chart — Line 4a IF you... AND you... THEN enter on line 4a...

have net earnings from self-employment

use either optional method to figure those net earnings,

the amount figured using Pub. 972 (even if you are also taking the EIC).

are taking the EIC on Form 1040, line 64a, or Form 1040A, line 38a

completed Worksheet B of the EIC instructions in your Form 1040 instructions,

your earned income from Worksheet B, line 4b, plus all of your nontaxable combat pay if you did not elect to include it in earned income for the EIC. If you were a member of the clergy, subtract (a) the rental value of a home or the nontaxable portion of an allowance for a home furnished to you (including payments for utilities), and (b) the value of meals and lodging provided to you, your spouse, and your dependents for your employer’s convenience.

did not complete Worksheet B or filed Form 1040A,

your earned income from Step 5 of the EIC instructions in your tax return instructions, plus all of your nontaxable combat pay if you did not elect to include it in earned income for the EIC.

are not taking the EIC

were self-employed, or you are filing Schedule SE because you were a member of the clergy or you had church employee income, or you are filing Schedule C or C-EZ as a statutory employee,

the amount figured using Pub. 972.

are not self-employed or filing Schedule SE, C, or C-EZ for the above reasons,

your earned income figured as follows:

Line 7 of Form 1040 or Form 1040A, or line 8 of Form 1040NR.

Subtract, if included on line 7 (line 8 for Form 1040NR), any: • Taxable scholarship or fellowship grant not reported on a Form W-2. • Amount received for work performed while an inmate in a penal institution (put “PRI” and the amount subtracted in the space next to line 7 of Form 1040 or 1040A (line 8 for Form 1040NR)). -

• Amount received as a pension or annuity from a nonqualified deferred compensation plan or a nongovernmental section 457 plan (put “DFC” and the amount subtracted in the space next to line 7 of Form 1040 or Form 1040A (line 8 for Form 1040NR)). This amount may be shown in box 11 of your Form W-2. If you received such an amount but box 11 is blank, contact your employer for the amount received as a pension or annuity. • Amount from Form 2555, line 43, or Form 2555-EZ, line 18.

Add all your nontaxable combat pay from Form(s) W-2, box 12, with code Q. +

Earned Income =

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Department of the Treasury Internal Revenue Service

2012 Instructions for Schedule A (Form 1040) Itemized Deductions

Use Schedule A (Form 1040) to figure your itemized deductions. In most cases, your federal income tax will be less if you take the larger of your itemized deductions or your standard deduction.

If you itemize, you can deduct a part of your medical and dental expenses and unre- imbursed employee business expenses, and amounts you paid for certain taxes, inter- est, contributions, and miscellaneous expenses. You can also deduct certain casualty and theft losses.

If you and your spouse paid expenses jointly and are filing separate returns for 2012, see Pub. 504 to figure the portion of joint expenses that you can claim as itemiz- ed deductions.

Do not include on Schedule A items deducted elsewhere, such as on Form 1040 or Schedule C, C-EZ, E, or F.

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Section references are to the Internal Revenue Code unless otherwise noted. Future Developments. For the latest information about developments related to Schedule A (Form 1040) and its in- structions, such as legislation enacted af- ter they were published, go to www.irs.gov/form1040.

What's New Standard mileage rates. The standard mileage rate allowed for operating ex- penses for a car when you use it for medical reasons is 23 cents per mile. The 2012 rate for use of your vehicle to do volunteer work for certain charitable organizations remains at 14 cents per mile.

Medical and Dental Expenses You can deduct only the part of your medical and dental expenses that ex- ceeds 7.5% of the amount on Form 1040, line 38.

Pub. 502 discusses the types of ex- penses you can and cannot deduct. It al- so explains when you can deduct capital expenses and special care expenses for disabled persons.

If you received a distribution from a health savings account or a medical savings account

in 2012, see Pub. 969 to figure your de- duction.

Examples of Medical and Dental Payments You Can Deduct To the extent you were not reimbursed, you can deduct what you paid for:

Insurance premiums for medical and dental care, including premiums for qualified long-term care insurance con- tracts as defined in Pub. 502. But see Limit on long-term care premiums you can deduct, later. Reduce the insurance premiums by any self-employed health insurance deduction you claimed on Form 1040, line 29. You cannot deduct insurance premiums paid with pretax dollars because the premiums are not in- cluded in box 1 of your Form(s) W-2. If you are a retired public safety officer, you cannot deduct any premiums you paid to the extent they were paid for with a tax-free distribution from your re- tirement plan.

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If, during 2012, you were an eligible trade adjustment assis- tance (TAA) recipient, alterna-

tive TAA (ATAA) recipient, reemploy- ment TAA (RTAA) recipient, or Pension Benefit Guaranty Corporation (PBGC) pension recipient, you must reduce your insurance premiums by any amounts used to figure the health coverage tax credit. See the instructions for Line 1.

Prescription medicines or insulin. Acupuncturists, chiropractors, den-

tists, eye doctors, medical doctors, occu- pational therapists, osteopathic doctors, physical therapists, podiatrists, psychia- trists, psychoanalysts (medical care on- ly), and psychologists.

Medical examinations, X-ray and laboratory services, insulin treatment, and whirlpool baths your doctor ordered.

Diagnostic tests, such as a full-body scan, pregnancy test, or blood sugar test kit.

Nursing help (including your share of the employment taxes paid). If you paid someone to do both nursing and housework, you can deduct only the cost of the nursing help.

Hospital care (including meals and lodging), clinic costs, and lab fees.

Qualified long-term care services (see Pub. 502).

The supplemental part of Medicare insurance (Medicare B).

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The premiums you pay for Medi- care Part D insurance.

A program to stop smoking and for prescription medicines to alleviate nico- tine withdrawal.

A weight-loss program as treat- ment for a specific disease (including obesity) diagnosed by a doctor.

Medical treatment at a center for drug or alcohol addiction.

Medical aids such as eyeglasses, contact lenses, hearing aids, braces, crutches, wheelchairs, and guide dogs, including the cost of maintaining them.

Surgery to improve defective vi- sion, such as laser eye surgery or radial keratotomy.

Lodging expenses (but not meals) while away from home to receive medi- cal care in a hospital or a medical care facility related to a hospital, provided there was no significant element of per- sonal pleasure, recreation, or vacation in the travel. Do not deduct more than $50 a night for each eligible person.

Ambulance service and other travel costs to get medical care. If you used your own car, you can claim what you spent for gas and oil to go to and from the place you received the care; or you can claim 23 cents per mile. Add park- ing and tolls to the amount you claim under either method.

Cost of breast pumps and supplies that assist lactation. Deceased taxpayer. Certain medical expenses paid out of a deceased taxpay- er's estate can be claimed on the de- ceased taxpayer's final return. See Pub. 502 for details. Limit on long-term care premiums you can deduct. The amount you can deduct for qualified long-term care in- surance contracts (as defined in Pub. 502) depends on the age, at the end of 2012, of the person for whom the premi- ums were paid. See the chart below for details.

IF the person was, at the end of 2012, age . . .

THEN the most you can deduct is . . .

.

40 or under $ 350

41–50 $ 660

51–60 $ 1,310

61–70 $ 3,500

71 or older $ 4,370

Examples of Medical and Dental Payments You Cannot Deduct

The cost of diet food. Cosmetic surgery unless it was

necessary to improve a deformity related to a congenital abnormality, an injury from an accident or trauma, or a disfig- uring disease.

Life insurance or income protec- tion policies.

The Medicare tax on your wages and tips or the Medicare tax paid as part of the self-employment tax or household employment taxes.

If you were age 65 or older but not entitled to social security benefits, you can deduct premi-

ums you voluntarily paid for Medicare A coverage.

Nursing care for a healthy baby. But you may be able to take a credit for the amount you paid. See the instruc- tions for Form 1040, line 48.

Illegal operations or drugs. Imported drugs not approved by

the U.S. Food and Drug Administration (FDA). This includes foreign-made ver- sions of U.S.-approved drugs manufac- tured without FDA approval.

Nonprescription medicines (includ- ing nicotine gum and certain nicotine patches).

Travel your doctor told you to take for rest or a change.

Funeral, burial, or cremation costs.

Line 1 Medical and Dental Expenses Enter the total of your medical and den- tal expenses, after you reduce these ex- penses by any payments received from insurance or other sources. See Reim- bursements, later.

Do not forget to include insur- ance premiums you paid for medical and dental care. But if

you claimed the self-employed health in- surance deduction on Form 1040, line 29, reduce the premiums by the amount on line 29.

TIP

TIP

If, during 2012, you were an eligible trade adjustment assis- tance (TAA) recipient, alterna-

tive TAA (ATAA) recipient, reemploy- ment TAA (RTAA) recipient, or Pension Benefit Guaranty Corporation (PBGC) pension recipient, you must complete Form 8885 before completing Sched- ule A, line 1. When figuring the amount of insurance premiums you can deduct on Schedule A, do not include:

Any amounts you included on Form 8885, line 4,

Any qualified health insurance pre- miums you paid to “U.S. Treasury—HCTC,” or

Any health coverage tax credit ad- vance payments shown in box 1 of Form 1099-H.

Whose medical and dental expenses can you include? You can include medical and dental bills you paid for anyone who was one of the following ei- ther when the services were provided or when you paid for them.

Yourself and your spouse. All dependents you claim on your

return. Your child whom you do not claim

as a dependent because of the rules for children of divorced or separated pa- rents.

Any person you could have claim- ed as a dependent on your return except that person received $3,800 or more of gross income or filed a joint return.

Any person you could have claim- ed as a dependent except that you, or your spouse if filing jointly, can be claimed as a dependent on someone else's 2012 return.

Example. You provided over half of your mother's support but cannot claim her as a dependent because she received wages of $3,800 in 2012. You can in- clude on line 1 any medical and dental expenses you paid in 2012 for your mother. Insurance premiums for certain non- dependents. You may have a medical or dental insurance policy that also cov- ers an individual who is not your de- pendent (for example, a nondependent child under age 27). You cannot deduct any premiums attributable to this indi- vidual, unless they are such a person de- scribed under Whose medical and dental expenses can you include, earlier.

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However, if you had family coverage when you added this individual to your policy and your premiums did not in- crease, you can enter on line 1 the full amount of your medical and dental in- surance premiums. See Pub. 502 for more information. Reimbursements. If your insurance company paid the provider directly for part of your expenses, and you paid only the amount that remained, include on line 1 only the amount you paid. If you received a reimbursement in 2012 for medical or dental expenses you paid in 2012, reduce your 2012 expenses by this amount. If you received a reimburse- ment in 2012 for prior year medical or dental expenses, do not reduce your 2012 expenses by this amount. But if you deducted the expenses in the earlier year and the deduction reduced your tax, you must include the reimbursement in income on Form 1040, line 21. See Pub. 502 for details on how to figure the amount to include. Cafeteria plans. Do not include on line 1 insurance premiums paid by an employer-sponsored health insurance plan (cafeteria plan) unless the premi- ums are included in box 1 of your Form(s) W-2. Also, do not include any other medical and dental expenses paid by the plan unless the amount paid is in- cluded in box 1 of your Form(s) W-2.

Taxes You Paid Taxes You Cannot Deduct

Federal income and most excise taxes.

Social security, Medicare, federal unemployment (FUTA), and railroad re- tirement (RRTA) taxes.

Customs duties. Federal estate and gift taxes. But

see the instructions for Line 28. Certain state and local taxes, in-

cluding: tax on gasoline, car inspection fees, assessments for sidewalks or other improvements to your property, tax you paid for someone else, and license fees (marriage, driver's, dog, etc.).

Line 5 You can elect to deduct state and local general sales taxes instead of state and local in-

come taxes. You cannot deduct both.

State and Local Income Taxes If you elect to deduct state and local in- come taxes, you must check box a on line 5. Include on this line the state and local income taxes listed below.

State and local income taxes with- held from your salary during 2012. Your Form(s) W-2 will show these amounts. Forms W-2G, 1099-G, 1099-R, and 1099-MISC may also show state and lo- cal income taxes withheld.

State and local income taxes paid in 2012 for a prior year, such as taxes paid with your 2011 state or local in- come tax return. Do not include penal- ties or interest.

State and local estimated tax pay- ments made during 2012, including any part of a prior year refund that you chose to have credited to your 2012 state or lo- cal income taxes.

Mandatory contributions you made to the California, New Jersey, or New York Nonoccupational Disability Bene- fit Fund, Rhode Island Temporary Disa- bility Benefit Fund, or Washington State Supplemental Workmen's Compensation Fund.

Mandatory contributions to the Alaska, California, New Jersey, or Penn- sylvania state unemployment fund.

Mandatory contributions to state family leave programs, such as the New Jersey Family Leave Insurance (FLI) program and the California Paid Family Leave program.

Do not reduce your deduction by any: State or local income tax refund or

credit you expect to receive for 2012, or Refund of, or credit for, prior year

state and local income taxes you actually received in 2012. Instead, see the in- structions for Form 1040, line 10.

State and Local General Sales Taxes If you elect to deduct state and local general sales taxes, you must check box b on line 5. To figure your deduction,

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you can use either your actual expenses or the optional sales tax tables.

Actual Expenses Generally, you can deduct the actual state and local general sales taxes (in- cluding compensating use taxes) you paid in 2012 if the tax rate was the same as the general sales tax rate. However, sales taxes on food, clothing, medical supplies, and motor vehicles are deducti- ble as a general sales tax even if the tax rate was less than the general sales tax rate. If you paid sales tax on a motor ve- hicle at a rate higher than the general sales tax rate, you can deduct only the amount of tax that you would have paid at the general sales tax rate on that vehi- cle. Motor vehicles include cars, motor- cycles, motor homes, recreational vehi- cles, sport utility vehicles, trucks, vans, and off-road vehicles. Also include any state and local general sales taxes paid for a leased motor vehicle. Do not in- clude sales taxes paid on items used in your trade or business.

You must keep your actual re- ceipts showing general sales taxes paid to use this method.

Refund of general sales taxes. If you received a refund of state or local gener- al sales taxes in 2012 for amounts paid in 2012, reduce your actual 2012 state and local general sales taxes by this amount. If you received a refund of state or local general sales taxes in 2012 for prior year purchases, do not reduce your 2012 state and local general sales taxes by this amount. But if you deducted your actual state and local general sales taxes in the earlier year and the deduc- tion reduced your tax, you may have to include the refund in income on Form 1040, line 21. See Recoveries in Pub. 525 for details.

Optional Sales Tax Tables Instead of using your actual expenses, you can use the 2012 Optional State and Certain Local Sales Tax Table and the 2012 Optional Local Sales Tax Tables for Certain Local Jurisdictions at the end of these instructions to figure your state and local general sales tax deduction. You may also be able to add the state and local general sales taxes paid on cer- tain specified items.

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To figure your state and local general sales tax deduction using the tables, complete the State and Local General Sales Tax Deduction Worksheet or use the Sales Tax Deduction Calculator on the IRS website. To use the Sales Tax Deduction Calculator, go to IRS.gov and enter “sales tax deduction calculator” in the search box.

If your filing status is married filing separately, both you and your spouse elect to deduct

sales taxes, and your spouse elects to use the optional sales tax tables, you al- so must use the tables to figure your state and local general sales tax deduc- tion.

Instructions for the State and Local General Sales Tax Deduction Worksheet Line 1. If you lived in the same state for all of 2012, enter the applicable

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amount, based on your 2012 income and exemptions, from the 2012 Optional State and Certain Local Sales Tax Table for your state. Read down the “At least– But less than” columns for your state and find the line that includes your 2012 income. If married filing separately, do not include your spouse's income. Your 2012 income is the amount shown on your Form 1040, line 38, plus any non- taxable items, such as the following.

Tax-exempt interest. Veterans' benefits. Nontaxable combat pay. Workers' compensation.

State and Local General Sales Tax Deduction Worksheet—Line 5b Keep for Your Records

Instead of using this worksheet, you can find your deduction by using the Sales Tax Deduction Calculator at IRS.gov.

See the instructions for line 1 of the worksheet if you: Lived in more than one state during 2012, or Had any nontaxable income in 2012.

Before you begin:

1. Enter your state general sales taxes from the 2012 Optional State and Certain Local Sales Tax Table . . . . . . . . . . . . . . . . . . . . 1. $

Next. If, for all of 2012, you lived only in Connecticut, the District of Columbia, Indiana, Kentucky, Maine, Maryland, Massachusetts, Michigan, New Jersey, Rhode Island, or West Virginia (except the cities of Huntington and Williamstown), skip lines 2 through 5, enter -0- on line 6, and go to line 7. Otherwise, go to line 2.

2. Did you live in Alaska, Arizona, Arkansas, Colorado, Georgia, Illinois, Louisiana, Missouri, New York, North Carolina, South Carolina, Tennessee, Utah, Virginia, or the cities of Huntington or Williamstown, West Virginia in 2012?

No. Enter -0-

. . . . . . . . . . . . . 2. $

Yes. Enter your base local general sales taxes from the 2012 Optional Local Sales Tax Tables for Certain Local Jurisdictions

3. Did your locality impose a local general sales tax in 2012? Residents of California and Nevada see the instructions for line 3 of the worksheet.

No. Skip lines 3 through 5, enter -0- on line 6, and go to line 7.

Yes. Enter your local general sales tax rate, but omit the percentage sign. For example, if your local general sales tax rate was 2.5%, enter 2.5. If your local general sales tax rate changed or you lived in more than one locality in the same state during 2012, see the instructions for line 3 of the worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3. .

4. Did you enter -0- on line 2 above?

No. Skip lines 4 and 5 and go to line 6.

Yes. Enter your state general sales tax rate (shown in the table heading for your state), but omit the percentage sign. For example, if your state general sales tax rate is 6%, enter 6.0 . . . . . . . . . . . . . . . . 4. .

5. Divide line 3 by line 4. Enter the result as a decimal (rounded to at least three places) . . . . . . . . . . . . . . . . 5. .

6. Did you enter -0- on line 2 above?

No. Multiply line 2 by line 3

. . . . . . . . . . . . . . . . . . . . 6. $ Yes. Multiply line 1 by line 5. If you lived in more than one locality in the same state during 2012, see the instructions for line 6 of the worksheet

7. Enter your state and local general sales taxes paid on specified items, if any. See the instructions for line 7 of the worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. $

8. Deduction for general sales taxes. Add lines 1, 6, and 7. Enter the result here and the total from all your state and local general sales tax deduction worksheets, if you completed more than one, on Schedule A, line 5. Be sure to check box b on that line . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8. $

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Nontaxable part of social security and railroad retirement benefits.

Nontaxable part of IRA, pension, or annuity distributions. Do not include rollovers.

Public assistance payments. The exemptions column refers to the number of exemptions claimed on Form 1040, line 6d.

What if you lived in more than one state? If you lived in more than one state during 2012, look up the table amount for each state using the above rules. If there is no table for your state, the table amount is considered to be zero. Multiply the table amount for each state you lived in by a fraction. The nu- merator of the fraction is the number of days you lived in the state during 2012 and the denominator is the total number of days in the year (366). Enter the total of the prorated table amounts for each state on line 1. However, if you also lived in a locality during 2012 that im- posed a local general sales tax, do not enter the total on line 1. Instead, com- plete a separate worksheet for each state you lived in and enter the prorated amount for that state on line 1.

Example. You lived in State A from January 1 through August 31, 2012 (244 days), and in State B from September 1 through December 31, 2012 (122 days). The table amount for State A is $500. The table amount for State B is $400. You would figure your state general sales tax as follows.

State A: $500 x 244/366 = $333 State B: $400 x 122/366 = 133 Total = $466

If none of the localities in which you lived during 2012 imposed a local gen- eral sales tax, enter $466 on line 1 of your worksheet. Otherwise, complete a separate worksheet for State A and State B. Enter $333 on line 1 of the State A worksheet and $133 on line 1 of the State B worksheet. Line 2. If you checked the “No” box, enter -0- on line 2, and go to line 3. If you checked the “Yes” box and lived in the same locality for all of 2012, enter the applicable amount, based on your 2012 income and exemptions, from the 2012 Optional Local Sales Tax Tables for Certain Local Jurisdictions for your

locality. Read down the “At least–But less than” columns for your locality and find the line that includes your 2012 in- come. See the instructions for line 1 of the worksheet to figure your 2012 in- come. The exemptions column refers to the number of exemptions claimed on Form 1040, line 6d.

What if you lived in more than one locality? If you lived in more than one locality during 2012, look up the table amount for each locality using the above rules. If there is no table for your locali- ty, the table amount is considered to be zero. Multiply the table amount for each locality you lived in by a fraction. The numerator of the fraction is the number of days you lived in the locality during 2012 and the denominator is the total number of days in the year (366). If you lived in more than one locality in the same state and the local general sales tax rate was the same for each locality, enter the total of the prorated table amounts for each locality in that state on line 2. Otherwise, complete a separate work- sheet for lines 2 through 6 for each lo- cality and enter each prorated table amount on line 2 of the applicable work- sheet.

Example. You lived in Locality 1 from January 1 through August 31, 2012 (244 days), and in Locality 2 from Sep- tember 1 through December 31, 2012 (122 days). The table amount for Locali- ty 1 is $100. The table amount for Lo- cality 2 is $150. You would figure the amount to enter on line 2 as follows. Note that this amount may not equal your local sales tax deduction, which is figured on line 6 of the worksheet.

Locality 1: $100 x 244/366 = $ 67 Locality 2: $150 x 122/366 = 50 Total = $117

Line 3. If you lived in California, check the “No” box if your combined state and local general sales tax rate is 7.2500%. Otherwise, check the “Yes” box and in- clude on line 3 only the part of the com- bined rate that is more than 7.2500%.

If you lived in Nevada, check the “No” box if your combined state and lo- cal general sales tax rate is 6.8500%. Otherwise, check the “Yes” box and in- clude on line 3 only the part of the com- bined rate that is more than 6.8500%.

What if your local general sales tax rate changed during 2012? If you checked the “Yes” box and your local general sales tax rate changed during 2012, figure the rate to enter on line 3 as follows. Multiply each tax rate for the period it was in effect by a fraction. The numerator of the fraction is the number of days the rate was in effect during 2012 and the denominator is the total number of days in the year (366). Enter the total of the prorated tax rates on line 3.

Example. Locality 1 imposed a 1% local general sales tax from January 1 through September 30, 2012 (274 days). The rate increased to 1.75% for the peri- od from October 1 through December 31, 2012 (92 days). You would enter “1.189” on line 3, figured as follows.

January 1 – September 30: 1.00 x 274/366 = 0.749 October 1 – December 31: 1.75 x 92/366 = 0.440 Total = 1.189

What if you lived in more than one locality in the same state during 2012? Complete a separate worksheet for lines 2 through 6 for each locality in your state if you lived in more than one local- ity in the same state during 2012 and each locality did not have the same local general sales tax rate.

To figure the amount to enter on line 3 of the worksheet for each locality in which you lived (except a locality for which you used the 2012 Optional Local Sales Tax Tables for Certain Local Ju- risdictions to figure your local general sales tax deduction), multiply the local general sales tax rate by a fraction. The numerator of the fraction is the number of days you lived in the locality during 2012 and the denominator is the total number of days in the year (366).

Example. You lived in Locality 1 from January 1 through August 31, 2012 (244 days), and in Locality 2 from Sep- tember 1 through December 31, 2012 (122 days). The local general sales tax rate for Locality 1 is 1%. The rate for Locality 2 is 1.75%. You would enter “0.667” on line 3 for the Locality 1 worksheet and “0.583” for the Locality 2 worksheet, figured as follows.

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Locality 1: 1.00 x 244/366 = 0.667 Locality 2: 1.75 x 122/366 = 0.583

Line 6. If you lived in more than one locality in the same state during 2012, you should have completed line 1 only on the first worksheet for that state and separate worksheets for lines 2 through 6 for any other locality within that state in which you lived during 2012. If you checked the “Yes” box on line 6 of any of those worksheets, multiply line 5 of that worksheet by the amount that you entered on line 1 for that state on the first worksheet. Line 7. Enter on line 7 any state and lo- cal general sales taxes paid on the fol- lowing specified items. If you are com- pleting more than one worksheet, include the total for line 7 on only one of the worksheets.

1. A motor vehicle (including a car, motorcycle, motor home, recreational vehicle, sport utility vehicle, truck, van, and off-road vehicle). Also include any state and local general sales taxes paid for a leased motor vehicle. If the state sales tax rate on these items is higher than the general sales tax rate, only in- clude the amount of tax you would have paid at the general sales tax rate.

2. An aircraft or boat, if the tax rate was the same as the general sales tax rate.

3. A home (including a mobile home or prefabricated home) or substan- tial addition to or major renovation of a home, but only if the tax rate was the same as the general sales tax rate and any of the following applies.

a. Your state or locality imposes a general sales tax directly on the sale of a home or on the cost of a substantial ad- dition or major renovation.

b. You purchased the materials to build a home or substantial addition or to perform a major renovation and paid the sales tax directly.

c. Under your state law, your con- tractor is considered your agent in the construction of the home or substantial addition or the performance of a major renovation. The contract must state that the contractor is authorized to act in your name and must follow your direc- tions on construction decisions. In this case, you will be considered to have pur-

chased any items subject to a sales tax and to have paid the sales tax directly.

Do not include sales taxes paid on items used in your trade or business. If you received a refund of state or local general sales taxes in 2012, see Refund of general sales taxes, earlier.

Line 6 Real Estate Taxes

If you are a homeowner who received assistance under a State Housing Finance Agency

Hardest Hit Fund program or an Emer- gency Homeowners' Loan program, see Pub. 530 for the amount you can deduct on line 6.

Include taxes (state, local, or foreign) you paid on real estate you own that was not used for business, but only if the tax- es are assessed uniformly at a like rate on all real property throughout the com- munity, and the proceeds are used for general community or governmental purposes. Pub. 530 explains the deduc- tions homeowners can take.

Do not include the following amounts on line 6.

Itemized charges for services to specific property or persons (for exam- ple, a $20 monthly charge per house for trash collection, a $5 charge for every 1,000 gallons of water consumed, or a flat charge for mowing a lawn that had grown higher than permitted under a lo- cal ordinance).

Charges for improvements that tend to increase the value of your prop- erty (for example, an assessment to build a new sidewalk). The cost of a property improvement is added to the basis of the property. However, a charge is deductible if it is used only to main- tain an existing public facility in service (for example, a charge to repair an exist- ing sidewalk, and any interest included in that charge).

If your mortgage payments include your real estate taxes, you can deduct only the amount the mortgage company actually paid to the taxing authority in 2012.

If you sold your home in 2012, any real estate tax charged to the buyer should be shown on your settlement statement and in box 5 of any Form

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1099-S you received. This amount is considered a refund of real estate taxes. See Refunds and rebates, later. Any real estate taxes you paid at closing should be shown on your settlement statement.

You must look at your real es- tate tax bill to decide if any nondeductible itemized charg-

es, such as those listed above, are inclu- ded in the bill. If your taxing authority (or lender) does not furnish you a copy of your real estate tax bill, ask for it.

Refunds and rebates. If you received a refund or rebate in 2012 of real estate taxes you paid in 2012, reduce your de- duction by the amount of the refund or rebate. If you received a refund or rebate in 2012 of real estate taxes you paid in an earlier year, do not reduce your de- duction by this amount. Instead, you must include the refund or rebate in in- come on Form 1040, line 21, if you de- ducted the real estate taxes in the earlier year and the deduction reduced your tax. See Recoveries in Pub. 525 for details on how to figure the amount to include in income.

Line 7 Personal Property Taxes Enter the state and local personal prop- erty taxes you paid, but only if the taxes were based on value alone and were im- posed on a yearly basis.

Example. You paid a yearly fee for the registration of your car. Part of the fee was based on the car's value and part was based on its weight. You can deduct only the part of the fee that was based on the car's value.

Line 8 Other Taxes If you had any deductible tax not listed on line 5, 6, or 7, list the type and amount of tax. Enter only one total on line 8. Include on this line income tax you paid to a foreign country or U.S. possession.

You may want to take a credit for the foreign tax instead of a deduction. See the instructions

for Form 1040, line 47, for details.

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Interest You Paid Whether your interest expense is treated as investment interest, personal interest, or business interest depends on how and when you used the loan proceeds. See Pub. 535 for details.

In general, if you paid interest in 2012 that applies to any period after 2012, you can deduct only amounts that apply for 2012.

Lines 10 and 11 Home Mortgage Interest

If you are a homeowner who received assistance under a State Housing Finance Agency

Hardest Hit Fund program or an Emer- gency Homeowners' Loan program, see Pub. 530 for the amount you can deduct on line 10 or 11.

A home mortgage is any loan that is se- cured by your main home or second home. It includes first and second mort- gages, home equity loans, and refi- nanced mortgages.

A home can be a house, condomini- um, cooperative, mobile home, boat, or similar property. It must provide basic living accommodations including sleep- ing space, toilet, and cooking facilities. Limit on home mortgage interest. If you took out any mortgages after Octo- ber 13, 1987, your deduction may be limited. Any additional amounts bor- rowed after October 13, 1987, on a line-of-credit mortgage you had on that date are treated as a mortgage taken out after October 13, 1987. If you refi- nanced a mortgage you had on October 13, 1987, treat the new mortgage as tak- en out on or before October 13, 1987. But if you refinanced for more than the balance of the old mortgage, treat the excess as a mortgage taken out after Oc- tober 13, 1987.

See Pub. 936 to figure your deduction if either (1) or (2) below applies. If you had more than one home at the same time, the dollar amounts in (1) and (2) apply to the total mortgages on both homes.

1. You took out any mortgages after October 13, 1987, and used the proceeds for purposes other than to buy, build, or

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improve your home, and all of these mortgages totaled over $100,000 at any time during 2012. The limit is $50,000 if married filing separately. An example of this type of mortgage is a home equity loan used to pay off credit card bills, buy a car, or pay tuition.

2. You took out any mortgages after October 13, 1987, and used the proceeds to buy, build, or improve your home, and these mortgages plus any mortgages you took out on or before October 13, 1987, totaled over $1 million at any time during 2012. The limit is $500,000 if married filing separately.

If the total amount of all mort- gages is more than the fair market value of the home, ad-

ditional limits apply. See Pub. 936.

Line 10 Enter on line 10 mortgage interest and points reported to you on Form 1098 un- der your social security number (SSN). If this form shows any refund of over- paid interest, do not reduce your deduc- tion by the refund. Instead, see the in- structions for Form 1040, line 21. If you and at least one other person (other than your spouse if filing jointly) were liable for and paid interest on the mortgage, and the interest was reported on Form 1098 under the other person's SSN, re- port your share of the interest on line 11 (as explained in the line 11 instructions).

If you paid more interest to the recip- ient than is shown on Form 1098, see Pub. 936 to find out if you can deduct the additional interest. If you can, attach a statement explaining the difference and enter “See attached” to the right of line 10.

If you are claiming the mort- gage interest credit (for hold- ers of qualified mortgage cred-

it certificates issued by state or local governmental units or agencies), sub- tract the amount shown on Form 8396, line 3, from the total deductible interest you paid on your home mortgage. Enter the result on line 10.

Line 11 If you did not receive a Form 1098 from the recipient, report your deductible mortgage interest on line 11.

CAUTION !

CAUTION !

If you bought your home from the re- cipient, be sure to show that recipient's name, identifying number, and address on the dotted lines next to line 11. If the recipient is an individual, the identifying number is his or her social security num- ber (SSN). Otherwise, it is the employer identification number. You must also let the recipient know your SSN. If you do not show the required information about the recipient or let the recipient know your SSN, you may have to pay a $50 penalty.

If you and at least one other person (other than your spouse if filing jointly) were liable for and paid interest on the mortgage, and the other person received the Form 1098, attach a statement to your return showing the name and ad- dress of that person. To the right of line 11, enter “See attached.”

Line 12 Points Not Reported on Form 1098 Points are shown on your settlement statement. Points you paid only to bor- row money are generally deductible over the life of the loan. See Pub. 936 to figure the amount you can deduct. Points paid for other purposes, such as for a lender's services, are not deducti- ble. Refinancing. Generally, you must de- duct points you paid to refinance a mort- gage over the life of the loan. This is true even if the new mortgage is secured by your main home.

If you used part of the proceeds to improve your main home, you may be able to deduct the part of the points rela- ted to the improvement in the year paid. See Pub. 936 for details.

If you paid off a mortgage ear- ly, deduct any remaining points in the year you paid off

the mortgage. However, if you refi- nanced your mortgage with the same lender, see Mortgage ending early in Pub. 936 for an exception.

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Line 13 Mortgage Insurance Premiums Enter the qualified mortgage insurance premiums you paid under a mortgage in- surance contract issued after December 31, 2006, in connection with home ac- quisition debt that was secured by your first or second home. Box 4 of Form 1098 may show the amount of premiums you paid in 2012. If you and at least one other person (other than your spouse if filing jointly) were liable for and paid the premiums in connection with the loan, and the premiums were reported on Form 1098 under the other person's SSN, report your share of the premiums on line 13. See Prepaid mortgage insur- ance premiums later if you paid any pre- miums allocable to any period after 2012.

Qualified mortgage insurance is mortgage insurance provided by the De- partment of Veterans Affairs, the Feder- al Housing Administration, or the Rural Housing Service (or their successor or- ganizations), and private mortgage in- surance (as defined in section 2 of the Homeowners Protection Act of 1998 as in effect on December 20, 2006).

Mortgage insurance provided by the Department of Veterans Affairs and the Rural Housing Service is commonly known as a funding fee and guarantee fee respectively. These fees can be de-

ducted fully in 2012 if the mortgage in- surance contract was issued in 2012. Contact the mortgage insurance issuer to determine the deductible amount if it is not included in box 4 of Form 1098. Prepaid mortgage insurance premi- ums. If you paid qualified mortgage in- surance premiums that are allocable to periods after 2012, you must allocate them over the shorter of:

The stated term of the mortgage, or 84 months, beginning with the

month the insurance was obtained. The premiums are treated as paid in the year to which they are allocated. If the mortgage is satisfied before its term, no deduction is allowed for the unamor- tized balance. See Pub. 936 for details.

The allocation rules, explained earli- er, do not apply to qualified mortgage insurance provided by the Department of Veterans Affairs or the Rural Housing Service (or their successor organiza- tions). Limit on amount you can deduct. You cannot deduct your mortgage insurance premiums if the amount on Form 1040, line 38, is more than $109,000 ($54,500 if married filing separately). If the amount on Form 1040, line 38, is more than $100,000 ($50,000 if married filing separately), your deduction is limited and you must use the Mortgage Insur- ance Premiums Deduction Worksheet to figure your deduction.

Line 14 Investment Interest Investment interest is interest paid on money you borrowed that is allocable to property held for investment. It does not include any interest allocable to passive activities or to securities that generate tax-exempt income.

Complete and attach Form 4952 to figure your deduction. Exception. You do not have to file Form 4952 if all three of the following apply.

1. Your investment interest expense is not more than your investment income from interest and ordinary dividends mi- nus any qualified dividends.

2. You have no other deductible in- vestment expenses.

3. You have no disallowed invest- ment interest expense from 2011.

Alaska Permanent Fund divi- dends, including those repor- ted on Form 8814, are not in-

vestment income.

For more details, see Pub. 550.

Gifts to Charity You can deduct contributions or gifts you gave to organizations that are reli- gious, charitable, educational, scientific, or literary in purpose. You can also de-

CAUTION !

Mortgage Insurance Premiums Deduction Worksheet—Line 13 Keep for Your Records See the instructions for line 13 to see if you must use this worksheet to figure your deduction.Before you begin:

1. Enter the total premiums you paid in 2012 for qualified mortgage insurance for a contract issued after December 31, 2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. Enter the amount from Form 1040, line 38 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.

3. Enter $100,000 ($50,000 if married filing separately) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.

4. Is the amount on line 2 more than the amount on line 3?

No. Your deduction is not limited. Enter the amount from line 1 above on Schedule A, line 13. Do not complete the rest of this worksheet.

Yes. Subtract line 3 from line 2. If the result is not a multiple of $1,000 ($500 if married filing separately), increase it to the next multiple of $1,000 ($500 if married filing separately). For example, increase $425 to $1,000, increase $2,025 to $3,000; or if married filing separately, increase $425 to $500, increase $2,025 to $2,500, etc. . . . . . . . . . . . . . . . . 4.

5. Divide line 4 by $10,000 ($5,000 if married filing separately). Enter the result as a decimal. If the result is 1.0 or more, enter 1.0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. .

6. Multiply line 1 by line 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.

7. Mortgage insurance premiums deduction. Subtract line 6 from line 1. Enter the result here and on Schedule A, line 13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.

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duct what you gave to organizations that work to prevent cruelty to children or animals. Certain whaling captains may be able to deduct expenses paid in 2012 for Native Alaskan subsistence bowhead whale hunting activities. See Pub. 526 for details.

To verify an organization's charitable status, you can:

Check with the organization to which you made the donation. The or- ganization should be able to provide you with verification of its charitable status.

Use our on-line search tool Exempt Organizations Select Check to see if an organization is eligible to receive tax-deductible contributions (Publication 78 data). You can access Exempt Organ- izations Select Check at www.irs.gov/ charities under Search for Charities.

Call our Tax Exempt/Government Entities Customer Account Services at 1-877-829-5500.

Examples of Qualified Charitable Organizations

Churches, mosques, synagogues, temples, etc.

Boy Scouts, Boys and Girls Clubs of America, CARE, Girl Scouts, Good- will Industries, Red Cross, Salvation Ar- my, United Way, etc.

Fraternal orders, if the gifts will be used for the purposes listed under Gifts to Charity, earlier.

Veterans' and certain cultural groups.

Nonprofit schools, hospitals, and organizations whose purpose is to find a cure for, or help people who have, ar- thritis, asthma, birth defects, cancer, cer- ebral palsy, cystic fibrosis, diabetes, heart disease, hemophilia, mental illness or retardation, multiple sclerosis, muscu- lar dystrophy, tuberculosis, etc.

Federal, state, and local govern- ments if the gifts are solely for public purposes.

Amounts You Can Deduct Contributions can be in cash, property, or out-of-pocket expenses you paid to do volunteer work for the kinds of organi- zations described earlier. If you drove to and from the volunteer work, you can take the actual cost of gas and oil or 14 cents a mile. Add parking and tolls to the amount you claim under either meth-

od. But do not deduct any amounts that were repaid to you. Gifts from which you benefit. If you made a gift and received a benefit in re- turn, such as food, entertainment, or merchandise, you can generally only de- duct the amount that is more than the value of the benefit. But this rule does not apply to certain membership benefits provided in return for an annual pay- ment of $75 or less or to certain items or benefits of token value. For details, see Pub. 526.

Example. You paid $70 to a charita- ble organization to attend a fund-raising dinner and the value of the dinner was $40. You can deduct only $30. Gifts of $250 or more. You can deduct a gift of $250 or more only if you have a statement from the charitable organiza- tion showing the information in (1) and (2) next.

1. The amount of any money con- tributed and a description (but not value) of any property donated.

2. Whether the organization did or did not give you any goods or services in return for your contribution. If you did receive any goods or services, a de- scription and estimate of the value must be included. If you received only intan- gible religious benefits (such as admis- sion to a religious ceremony), the organ- ization must state this, but it does not have to describe or value the benefit.

In figuring whether a gift is $250 or more, do not combine separate dona- tions. For example, if you gave your church $25 each week for a total of $1,300, treat each $25 payment as a sep- arate gift. If you made donations through payroll deductions, treat each deduction from each paycheck as a sepa- rate gift. See Pub. 526 if you made a separate gift of $250 or more through payroll deduction.

You must get the statement by the date you file your return or the due date (including exten-

sions) for filing your return, whichever is earlier. Do not attach the statement to your return. Instead, keep it for your re- cords.

Limit on the amount you can deduct. See Pub. 526 to figure the amount of

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your deduction if any of the following applies.

1. Your cash contributions or contri- butions of ordinary income property are more than 30% of the amount on Form 1040, line 38.

2. Your gifts of capital gain property are more than 20% of the amount on Form 1040, line 38.

3. You gave gifts of property that increased in value or gave gifts of the use of property.

Amounts You Cannot Deduct

Travel expenses (including meals and lodging) while away from home, unless there was no significant element of personal pleasure, recreation, or vaca- tion in the travel.

Political contributions. Dues, fees, or bills paid to country

clubs, lodges, fraternal orders, or similar groups.

Cost of raffle, bingo, or lottery tickets. But you may be able to deduct these expenses on line 28. See the in- structions for Line 28 for details.

Value of your time or services. Value of blood given to a blood

bank. The transfer of a future interest in

tangible personal property (generally, until the entire interest has been transfer- red).

Gifts to individuals and groups that are run for personal profit.

Gifts to foreign organizations. But you may be able to deduct gifts to cer- tain U.S. organizations that transfer funds to foreign charities and certain Canadian, Israeli, and Mexican charities. See Pub. 526 for details.

Gifts to organizations engaged in certain political activities that are of di- rect financial interest to your trade or business. See section 170(f)(9).

Gifts to groups whose purpose is to lobby for changes in the laws.

Gifts to civic leagues, social and sports clubs, labor unions, and chambers of commerce.

Value of benefits received in con- nection with a contribution to a charita- ble organization. See Pub. 526 for ex- ceptions.

Cost of tuition. But you may be able to deduct this as a job education ex-

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pense on line 21; as a tuition and fees deduction on Form 1040, line 34; or take an education credit (see Form 8863).

Line 16 Gifts by Cash or Check Enter on line 16 the total gifts you made in cash or by check (including out-of-pocket expenses). Recordkeeping. For any contribution made in cash, regardless of the amount, you must maintain as a record of the contribution a bank record (such as a canceled check or credit card statement) or a written record from the charity. The written record must include the name of the charity, date, and amount of the con- tribution. If you made contributions through payroll deduction, see Pub. 526 for information on the records you must keep. Do not attach the record to your tax return. Instead, keep it with your other tax records.

Line 17 Other Than by Cash or Check Enter your contributions of property. If you gave used items, such as clothing or furniture, deduct their fair market value at the time you gave them. Fair market value is what a willing buyer would pay a willing seller when neither has to buy or sell and both are aware of the condi- tions of the sale. For more details on de- termining the value of donated property, see Pub. 561.

If the amount of your deduction is more than $500, you must complete and attach Form 8283. For this purpose, the “amount of your deduction” means your deduction before applying any income limits that could result in a carryover of contributions. If you deduct more than $500 for a contribution of a motor vehi- cle, boat, or airplane, you must also at- tach a statement from the charitable or- ganization to your return. The organiza- tion may use Form 1098-C to provide the required information. If your total deduction is over $5,000, you may also have to get appraisals of the values of the donated property. This amount is $500 for certain contributions of cloth- ing and household items (see below).

See Form 8283 and its instructions for details. Contributions of clothing and house- hold items. A deduction for these con- tributions will be allowed only if the items are in good used condition or bet- ter. However, this rule does not apply to a contribution of any single item for which a deduction of more than $500 is claimed and for which you include a qualified appraisal and Form 8283 with your tax return. Recordkeeping. If you gave property, you should keep a receipt or written statement from the organization you gave the property to, or a reliable written record, that shows the organization's name and address, the date and location of the gift, and a description of the prop- erty. For each gift of property, you should also keep reliable written records that include:

How you figured the property's value at the time you gave it. If the value was determined by an appraisal, keep a signed copy of the appraisal.

The cost or other basis of the prop- erty if you must reduce it by any ordina- ry income or capital gain that would have resulted if the property had been sold at its fair market value.

How you figured your deduction if you chose to reduce your deduction for gifts of capital gain property.

Any conditions attached to the gift.

If your total deduction for gifts of property is over $500, you gave less than your entire in-

terest in the property, or you made a “qualified conservation contribution,” your records should contain additional information. See Pub. 526 for details.

Line 18 Carryover From Prior Year Enter any carryover of contributions that you could not deduct in an earlier year because they exceeded your adjusted gross income limit. See Pub. 526 for de- tails.

CAUTION !

Casualty and Theft Losses Line 20 Complete and attach Form 4684 to fig- ure the amount of your loss to enter on line 20.

You may be able to deduct part or all of each loss caused by theft, vandalism, fire, storm, or similar causes; car, boat, and other accidents; and corrosive dry- wall. You may also be able to deduct money you had in a financial institution but lost because of the insolvency or bankruptcy of the institution.

You can deduct personal casualty or theft losses only to the extent that:

1. The amount of each separate casualty or theft loss is more than $100, and

2. The total amount of all losses during the year (reduced by the $100 limit discussed in (1) above) is more than 10% of the amount on Form 1040, line 38.

Corrosive drywall losses. If you paid for repairs to your personal residence or household appliances because of corro- sive drywall that was installed between 2001 and 2008, you may be able to de- duct on line 20 those amounts paid. See Pub. 547 for details.

Use Schedule A, line 23, to deduct the costs of proving that you had a prop- erty loss. Examples of these costs are appraisal fees and photographs used to establish the amount of your loss.

Job Expenses and Certain Miscellaneous Deductions You can deduct only the part of these expenses that exceeds 2% of the amount on Form 1040, line 38.

Pub. 529 discusses the types of ex- penses that can and cannot be deducted.

Examples of Expenses You Cannot Deduct

Political contributions.

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Legal expenses for personal mat- ters that do not produce taxable income.

Lost or misplaced cash or property. Expenses for meals during regular

or extra work hours. The cost of entertaining friends. Commuting expenses. See Pub.

529 for the definition of commuting. Travel expenses for employment

away from home if that period of em- ployment exceeds 1 year. See Pub. 529 for an exception for certain federal em- ployees.

Travel as a form of education. Expenses of attending a seminar,

convention, or similar meeting unless it is related to your employment.

Club dues. Expenses of adopting a child. But

you may be able to take a credit for adoption expenses. See Form 8839 for details.

Fines and penalties. Expenses of producing tax-exempt

income.

Line 21 Unreimbursed Employee Expenses Enter the total ordinary and necessary job expenses you paid for which you were not reimbursed. (Amounts your employer included in box 1 of your Form W-2 are not considered reimburse- ments.)

An ordinary expense is one that is common and accepted in your field of trade, business, or profession. A neces- sary expense is one that is helpful and appropriate for your business. An ex- pense does not have to be required to be considered necessary.

But you must fill in and attach Form 2106 if either (1) or (2), next, applies.

1. You claim any travel, transporta- tion, meal, or entertainment expenses for your job.

2. Your employer paid you for any of your job expenses that you would otherwise report on line 21.

If you used your own vehicle, are using the standard mileage rate, and (2) earlier, does not

apply, you may be able to file Form 2106-EZ instead.

TIP

If you do not have to file Form 2106 or 2106-EZ, list the type and amount of each expense on the dotted line next to line 21. If you need more space, attach a statement showing the type and amount of each expense. Enter the total of all these expenses on line 21.

Do not include on line 21 any educator expenses you deduc- ted on Form 1040, line 23.

Examples of other expenses to in- clude on line 21 are:

Safety equipment, small tools, and supplies needed for your job.

Uniforms required by your em- ployer that are not suitable for ordinary wear.

Protective clothing required in your work, such as hard hats, safety shoes, and glasses.

Physical examinations required by your employer.

Dues to professional organizations and chambers of commerce.

Subscriptions to professional jour- nals.

Fees to employment agencies and other costs to look for a new job in your present occupation, even if you do not get a new job.

Certain business use of part of your home. For details, including limits that apply, use TeleTax topic 509 (see the Form 1040 instructions) or see Pub. 587.

Certain educational expenses. For details, use TeleTax topic 513 (see the Form 1040 instructions) or see Pub. 970. Reduce your educational expenses by any tuition and fees deduction you claimed on Form 1040, line 34.

You may be able to take a credit for your educational ex- penses instead of a deduction.

See Form 8863 for details.

Line 22 Tax Preparation Fees Enter the fees you paid for preparation of your tax return, including fees paid for filing your return electronically. If you paid your tax by credit or debit card, include the convenience fee you were charged on line 23 instead of this line.

CAUTION !

TIP

Line 23 Other Expenses Enter the total amount you paid to pro- duce or collect taxable income and man- age or protect property held for earning income. But do not include any personal expenses. List the type and amount of each expense on the dotted lines next to line 23. If you need more space, attach a statement showing the type and amount of each expense. Enter one total on line 23.

Examples of expenses to include on line 23 are:

Certain legal and accounting fees. Clerical help and office rent. Custodial (for example, trust ac-

count) fees. Your share of the investment ex-

penses of a regulated investment compa- ny.

Certain losses on nonfederally in- sured deposits in an insolvent or bank- rupt financial institution. For details, in- cluding limits that apply, see Pub. 529.

Casualty and theft losses of proper- ty used in performing services as an em- ployee from Form 4684, lines 32 and 38b, or Form 4797, line 18a.

Deduction for repayment of amounts under a claim of right if $3,000 or less.

Convenience fee charged by the card processor for paying your income tax (including estimated tax payments) by credit or debit card. The deduction is claimed for the year in which the fee was charged to your card.

Other Miscellaneous Deductions Line 28 Only the expenses listed next can be de- ducted on this line. List the type and amount of each expense on the dotted lines next to line 28. If you need more space, attach a statement showing the type and amount of each expense. Enter one total on line 28.

Gambling losses (gambling losses include, but are not limited to, the cost of non-winning bingo, lottery, and raffle tickets), but only to the extent of gam-

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bling winnings reported on Form 1040, line 21.

Casualty and theft losses of in- come-producing property from Form 4684, lines 32 and 38b, or Form 4797, line 18a.

Loss from other activities from Schedule K-1 (Form 1065-B), box 2.

Federal estate tax on income in re- spect of a decedent.

Amortizable bond premium on bonds acquired before October 23, 1986.

Deduction for repayment of amounts under a claim of right if over $3,000. See Pub. 525 for details.

Certain unrecovered investment in a pension.

Impairment-related work expenses of a disabled person.

For more details, see Pub. 529.

Total Itemized Deductions Line 30 If you elect to itemize for state tax or other purposes even though your itemiz- ed deductions are less than your stand- ard deduction, check the box on line 30.

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2012 Optional State and Certain Local Sales Tax Tables Income

At least

But less than

Exemptions

1 2 3 4 5 Over

5

$0 20,000 30,000 40,000

$20,000 30,000 40,000 50,000

50,000 60,000 70,000 80,000 90,000

60,000 70,000 80,000 90,000

100,000

100,000 120,000 140,000 160,000 180,000

120,000 140,000 160,000 180,000 200,000

200,000 or more

Connecticut

ColoradoCalifornia1ArkansasAlabama Arizona

District of Columbia FloridaIncome $0

20,000 30,000 40,000

$20,000 30,000 40,000 50,000

50,000 60,000 70,000 80,000 90,000

60,000 70,000 80,000 90,000

100,000

100,000 120,000 140,000 160,000 180,000

120,000 140,000 160,000 180,000 200,000

200,000 or more

Exemptions Exemptions Exemptions

IllinoisIdaho

Hawaii4Georgia

Income

$0 20,000 30,000 40,000

$20,000 30,000 40,000 50,000

50,000 60,000 70,000 80,000 90,000

60,000 70,000 80,000 90,000

100,000

100,000 120,000 140,000 160,000 180,000

120,000 140,000 160,000 180,000 200,000

200,000 or more

1 2 3 4 5 Over

5 1 2 3 4 5 Over

5 1 2 3 4 5 Over

5 1 2 3 4 5 Over

5

MarylandMaineLouisianaKentuckyIncome $0

20,000 30,000 40,000

$20,000 30,000 40,000 50,000

50,000 60,000 70,000 80,000 90,000

60,000 70,000 80,000 90,000

100,000

100,000 120,000 140,000 160,000 180,000

120,000 140,000 160,000 180,000 200,000

200,000 or more

Income

$0 20,000 30,000 40,000

$20,000 30,000 40,000 50,000

50,000 60,000 70,000 80,000 90,000

60,000 70,000 80,000 90,000

100,000

100,000 120,000 140,000 160,000 180,000

120,000 140,000 160,000 180,000 200,000

200,000 or more

4.0000% 6.6000% 6.0000% 7.2500% 2.9000%

Exemptions

6.3500% 6.0000% 6.0000% 4.0000% 4.0000%

Massachusetts

Indiana Iowa Kansas

Michigan Minnesota Mississippi Missouri Nebraska

6.0000% 6.2500% 7.0000% 6.0000% 6.3000%

6.0000% 4.0000% 5.0000% 6.0000% 6.2500%

6.0000% 6.8750% 7.0000% 4.2250% 5.5000%

(Continued)

235 346 399 444

483 518 551 581 609

646 695 738 781 818

1002

274 401 463 514

559 599 636 671 703

745 802 850 899 942

1150

300 438 505 561

609 653 694 731 766

811 872 925 977

1024

1249

320 337 360 467 491 524 538 565 603 597 626 668

648 681 726 695 729 777 738 774 825 777 815 869 814 854 910

862 904 963 927 972 1035 983 1031 1097

1038 1088 1158 1087 1139 1213

1325 1388 1476

289 312 327 337 346 358 467 503 526 543 557 575 557 601 628 648 664 686 635 684 715 738 757 781

704 759 794 819 839 867 768 828 865 892 915 944 828 892 932 962 986 1018 883 952 994 1026 1051 1086 936 1008 1054 1087 1114 1150

1005 1083 1131 1167 1196 1235 1100 1185 1238 1277 1308 1351 1183 1274 1331 1373 1406 1452 1266 1363 1423 1468 1504 1553 1340 1442 1507 1554 1592 1643

1710 1840 1922 1982 2030 2095

315 346 365 380 391 407 496 544 574 597 615 640 586 643 679 706 727 757 663 728 768 799 823 856

732 803 848 881 908 945 795 871 920 956 986 1025 853 936 988 1027 1058 1101 907 995 1050 1092 1125 1170 958 1051 1109 1153 1188 1236

1025 1124 1187 1233 1271 1322 1116 1224 1292 1343 1384 1440 1196 1311 1384 1438 1482 1542 1274 1397 1475 1533 1580 1643 1345 1475 1557 1618 1667 1734

1693 1857 1960 2036 2098 2182

307 329 343 353 361 372 493 528 550 566 579 596 588 630 655 674 689 710 669 716 745 767 784 807

742 794 826 850 869 895 809 865 900 926 946 974 871 932 970 997 1019 1049 929 994 1034 1063 1087 1119 984 1052 1095 1126 1151 1184

1056 1129 1175 1208 1235 1271 1155 1235 1285 1321 1350 1389 1242 1327 1380 1419 1451 1493 1328 1419 1476 1517 1551 1596 1405 1501 1561 1605 1641 1688

1790 1912 1988 2044 2088 2148

119 130 138 143 148 154 185 203 214 223 230 239 219 240 253 263 271 282 247 271 286 297 306 318

273 298 315 327 337 350 296 323 341 354 365 380 317 347 366 380 391 407 337 369 389 404 416 432 356 389 410 426 439 456

381 416 439 456 469 488 415 453 477 496 510 530 444 485 511 530 546 567 473 517 544 565 582 604 499 545 574 596 613 637

629 686 722 749 771 800

310 334 349 361 370 382 492 531 555 573 587 606 584 630 659 680 697 720 662 715 747 771 790 816

732 790 826 853 874 903 796 859 898 927 950 981 856 924 966 997 1021 1055 911 983 1028 1061 1088 1123 964 1040 1087 1122 1150 1188

1032 1114 1165 1202 1232 1272 1126 1215 1270 1311 1344 1388 1208 1303 1363 1406 1441 1488 1289 1391 1454 1501 1538 1588 1362 1470 1536 1586 1625 1678

1723 1859 1943 2006 2055 2123

203 218 227 234 239 247 328 352 367 378 386 398 392 421 438 451 462 476 447 480 500 514 526 542

497 532 555 571 584 602 542 581 605 623 637 656 584 626 652 671 687 708 624 668 696 717 733 755 661 708 738 759 777 800

710 761 792 816 834 859 778 833 867 893 913 941 836 896 933 960 982 1012 895 959 998 1027 1051 1082 948 1015 1057 1088 1113 1146

1211 1296 1350 1389 1420 1463

282 304 317 327 335 346 451 485 507 522 535 552 537 577 603 621 636 657 610 656 685 706 723 746

676 727 758 782 801 826 735 791 825 851 871 899 792 851 888 916 938 967 844 907 947 976 999 1031 893 960 1002 1033 1057 1091

958 1029 1074 1107 1134 1169 1046 1125 1173 1209 1238 1277 1123 1207 1260 1298 1329 1371 1200 1290 1346 1387 1420 1464 1269 1364 1423 1466 1501 1548

1612 1732 1806 1861 1905 1965

164 180 190 197 203 211 258 282 297 309 318 331 305 333 351 365 376 390 345 377 398 413 425 441

381 416 439 455 469 487 414 452 476 494 508 528 445 485 511 530 546 567 473 516 543 564 580 603 500 545 574 595 613 636

535 583 614 637 655 681 583 635 669 694 714 741 625 681 716 743 765 794 666 726 764 792 815 846 703 766 806 836 860 893

888 967 1016 1054 1084 1124

282 322 348 368 384 407 423 483 522 552 576 610 492 561 607 641 669 708 550 627 678 716 748 791

601 685 740 782 816 864 647 738 797 842 878 929 690 786 849 897 936 990 729 831 897 948 989 1046 766 873 942 995 1039 1099

814 927 1001 1058 1103 1167 880 1001 1081 1142 1191 1260 936 1065 1150 1214 1267 1340 991 1128 1218 1286 1341 1418

1041 1184 1278 1349 1408 1488

1282 1457 1572 1660 1731 1830

349 407 445 475 500 534 519 603 659 702 738 788 601 698 762 812 853 910 670 777 849 904 949 1013

731 847 925 985 1034 1103 786 910 993 1057 1110 1184 837 969 1057 1125 1181 1259 884 1023 1115 1187 1246 1328 929 1073 1170 1245 1306 1393

986 1139 1242 1321 1386 1477 1064 1228 1338 1423 1493 1591 1131 1305 1422 1511 1585 1689 1198 1381 1504 1598 1676 1785 1257 1449 1577 1676 1758 1872

1547 1779 1934 2054 2153 2290

262 290 307 321 332 346 408 449 476 496 512 535 481 529 560 583 602 628 543 596 631 657 678 707

598 656 694 723 746 778 648 711 752 782 807 842 695 762 805 838 865 902 739 809 855 890 918 957 780 854 902 938 968 1009

834 912 963 1002 1034 1077 907 992 1047 1089 1123 1170 971 1061 1120 1164 1200 1250

1034 1130 1192 1239 1277 1330 1091 1192 1257 1306 1346 1402

1373 1496 1576 1637 1686 1754

306 337 358 373 385 473 522 552 575 594 556 613 649 676 698 626 690 731 761 786

689 759 803 837 864 745 821 869 905 934 798 879 931 969 1000 847 933 987 1028 1061 893 983 1040 1083 1118

953 1049 1110 1156 1193 1035 1139 1205 1255 1295 1105 1217 1288 1340 1383 1176 1294 1369 1425 1470 1239 1363 1442 1501 1549

1547 1702 1800 1874 1933

322 338 350 360 373 513 539 558 573 594 610 640 663 681 706 692 727 753 773 801

766 804 833 856 886 833 875 906 930 964 896 941 974 1001 1037 955 1002 1038 1066 1104

1010 1060 1098 1128 1168

1082 1136 1176 1208 1252 1181 1240 1284 1319 1366 1267 1331 1378 1415 1466 1353 1421 1471 1511 1565 1430 1502 1555 1597 1654

1812 1902 1969 2023 2095

296 472 561 637

705 767 825 878 929

996 1087 1166 1245 1316

1667

399 462 503 536 562 599 598 691 753 801 840 894 695 803 875 930 975 1038 777 897 977 1038 1088 1158

849 980 1066 1133 1188 1264 913 1054 1147 1219 1277 1359 973 1123 1222 1298 1361 1448

1029 1186 1291 1371 1437 1529 1080 1246 1356 1440 1509 1606

1148 1323 1440 1529 1603 1705 1239 1429 1554 1650 1729 1839 1318 1519 1652 1754 1838 1955 1396 1608 1749 1857 1946 2069 1466 1688 1836 1949 2042 2171

1804 2076 2256 2394 2508 2666

401 619 727 819

900 974

1042 1106 1165

1243 1349 1441 1532 1614

2014

254 279 295 306 316 329 400 438 462 480 494 514 472 517 545 567 584 607 535 585 617 641 660 686

590 645 680 707 728 756 640 700 738 766 789 820 688 752 792 823 847 880 731 799 842 874 900 936 773 844 889 923 951 988

827 903 951 988 1017 1056 901 984 1036 1075 1107 1150 965 1054 1110 1152 1185 1231

1029 1123 1183 1227 1263 1312 1087 1186 1248 1295 1333 1384

1371 1494 1573 1631 1678 1742

187 201 210 216 221 228 300 322 336 346 354 364 357 383 400 411 421 434 407 436 454 468 479 493

451 483 503 518 530 546 491 526 548 564 577 595 528 566 590 608 621 640 563 604 629 648 662 682 596 639 666 685 701 722

640 686 714 735 752 775 699 749 780 803 822 847 751 805 838 863 883 909 802 860 896 922 943 971 849 910 947 975 997 1027

1079 1156 1204 1239 1267 1305

173 186 194 200 205 211 279 299 312 321 329 339 333 357 372 383 392 404 379 406 423 436 446 460

420 451 469 483 495 510 458 491 511 527 539 555 494 529 551 567 580 598 527 564 588 605 619 638 558 598 623 641 656 675

599 642 668 688 704 725 656 702 731 752 770 793 705 755 786 809 827 852 754 807 840 865 884 911 798 854 889 915 936 964

1018 1089 1134 1166 1193 1228

251 273 287 297 306 318 399 434 456 472 486 504 475 515 541 561 576 598 539 585 614 636 654 678

597 648 680 704 723 750 650 704 739 765 786 815 700 758 795 823 846 876 745 807 847 877 901 933 789 854 896 927 952 987

846 916 960 994 1021 1058 924 1000 1048 1085 1114 1154

213 232 244 253 260 270 330 359 377 390 401 416 388 422 443 458 471 488 438 475 499 516 530 550

482 523 548 568 583 604 522 565 593 614 631 653 559 606 635 658 675 700 593 643 674 698 717 742 626 678 711 736 755 782

668 724 759 785 806 835 726 786 824 853 876 907

244 266 280 290 298 309 381 415 436 452 465 482 450 489 514 533 548 568 509 553 581 602 618 641

561 609 640 663 681 706 608 661 694 718 738 765 653 709 744 771 792 821 694 753 791 819 841 872 733 795 835 864 888 920

783 850 892 924 949 983 853 925 971 1005 1032 1070

284 304 316 325 332 342 453 484 503 518 529 544 538 575 598 615 629 647 611 653 679 698 714 734

676 723 752 773 790 813 735 786 817 840 859 884 791 845 879 904 924 951 842 900 936 963 984 1013 891 952 991 1019 1041 1071

955 1021 1062 1092 1116 1148 1042 1114 1159 1192 1218 1253

469 535 578 611 638 675 704 803 867 916 956 1011 819 933 1008 1064 1111 1175 916 1043 1126 1189 1241 1312

1001 1140 1230 1299 1355 1433 1078 1226 1324 1398 1458 1542 1149 1307 1411 1490 1554 1643 1215 1382 1491 1574 1642 1736 1276 1452 1566 1653 1725 1823

1356 1542 1664 1757 1832 1937 1465 1666 1797 1896 1978 2091

187 209 223 234 243 255 293 327 349 366 379 398 346 386 412 431 447 469 391 436 465 487 505 530

431 481 513 537 557 584 468 521 556 582 603 633 502 559 596 624 647 678 534 594 634 663 688 721 564 628 669 700 726 761

603 671 715 749 776 813 656 730 778 814 844 884

993 1073 1125 1164 1195 1238 1061 1146 1201 1243 1276 1322 1122 1212 1270 1314 1349 1397

1426 1539 1611 1665 1709 1769

777 841 881 911 936 969 827 894 937 969 995 1030 871 943 988 1021 1048 1085

1092 1180 1236 1277 1311 1356

913 991 1039 1076 1105 1145 973 1056 1107 1146 1177 1219

1027 1114 1168 1209 1241 1286

1294 1401 1469 1519 1560 1615

1119 1196 1243 1279 1307 1345 1194 1276 1327 1365 1395 1435 1262 1349 1403 1443 1474 1517

1599 1709 1777 1828 1868 1922

1559 1772 1911 2017 2104 2223 1651 1877 2024 2136 2228 2354 1734 1970 2125 2242 2338 2471

2136 2425 2615 2758 2876 3038

703 782 833 872 903 946 749 833 888 929 962 1008 791 879 936 980 1015 1063

997 1107 1178 1231 1275 1335

269 291 304 314 322 333 429 463 484 500 513 530 509 550 575 594 609 629 578 624 653 674 691 714

640 691 723 746 765 791 696 751 786 812 832 860 748 808 845 873 895 925 797 861 900 930 953 985 843 911 952 983 1008 1042

904 976 1021 1054 1081 1116 986 1065 1114 1150 1179 1218

1058 1143 1195 1234 1265 1307 1130 1220 1276 1318 1351 1396 1194 1289 1349 1393 1428 1475

1512 1633 1708 1764 1808 1868

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2012 Optional State and Certain Local Sales Tax Tables (Continued) Income

At least

But less than

Exemptions

1 2 3 4 5 Over

5

$0 20,000 30,000 40,000

$20,000 30,000 40,000 50,000

50,000 60,000 70,000 80,000 90,000

60,000 70,000 80,000 90,000

100,000

100,000 120,000 140,000 160,000 180,000

120,000 140,000 160,000 180,000 200,000

200,000 or more

North Dakota

North CarolinaNew YorkNew MexicoNevada2 New Jersey 3

Ohio OklahomaIncome $0

20,000 30,000 40,000

$20,000 30,000 40,000 50,000

50,000 60,000 70,000 80,000 90,000

60,000 70,000 80,000 90,000

100,000

100,000 120,000 140,000 160,000 180,000

120,000 140,000 160,000 180,000 200,000

200,000 or more

Exemptions Exemptions Exemptions

South DakotaSouth Carolina

Rhode IslandPennsylvania

Income

$0 20,000 30,000 40,000

$20,000 30,000 40,000 50,000

50,000 60,000 70,000 80,000 90,000

60,000 70,000 80,000 90,000

100,000

100,000 120,000 140,000 160,000 180,000

120,000 140,000 160,000 180,000 200,000

200,000 or more

1 2 3 4 5 Over

5 1 2 3 4 5 Over

5 1 2 3 4 5 Over

5 1 2 3 4 5 Over

5

West VirginiaWashingtonVirginiaVermontIncome $0

20,000 30,000 40,000

$20,000 30,000 40,000 50,000

50,000 60,000 70,000 80,000 90,000

60,000 70,000 80,000 90,000

100,000

100,000 120,000 140,000 160,000 180,000

120,000 140,000 160,000 180,000 200,000

200,000 or more

Income

$0 20,000 30,000 40,000

$20,000 30,000 40,000 50,000

50,000 60,000 70,000 80,000 90,000

60,000 70,000 80,000 90,000

100,000

100,000 120,000 140,000 160,000 180,000

120,000 140,000 160,000 180,000 200,000

200,000 or more

6.8500% 7.0000% 5.1250% 4.0000% 4.7500%

Exemptions

5.0000% 5.5000% 4.5000% 6.0000% 7.0000%

Wisconsin

Tennessee Texas Utah

Wyoming

6.0000% 4.0000% 7.0000% 6.2500% 4.7000%

6.0000% 4.0000% 6.5000% 6.0000% 5.0000%

4.0000%

1

2

3

4

285 310 326 337 347 360 441 478 502 520 534 554 518 562 590 611 627 650 584 633 664 688 706 732

642 696 731 756 776 804 695 754 790 818 840 870 745 807 847 876 899 931 791 857 898 929 954 988 834 903 947 980 1006 1041

891 964 1011 1045 1073 1111 968 1048 1098 1135 1165 1206

1035 1120 1174 1213 1245 1289 1101 1192 1248 1291 1324 1370 1161 1256 1316 1360 1395 1444

1455 1573 1646 1701 1745 1805

298 318 330 339 346 356 473 505 524 538 550 565 562 599 622 639 652 670 637 679 705 724 739 760

705 751 780 801 818 840 766 816 847 870 888 913 823 878 911 936 955 982 877 934 970 996 1017 1045 927 988 1025 1053 1075 1105

993 1058 1098 1128 1151 1183 1083 1154 1198 1230 1256 1291 1162 1238 1285 1319 1347 1384 1240 1321 1371 1408 1437 1477 1310 1395 1448 1487 1518 1560

1657 1765 1831 1880 1920 1972

276 297 311 320 328 339 432 466 486 502 514 530 511 550 574 592 607 626 577 621 649 669 685 707

636 685 715 738 756 780 690 743 776 800 819 845 740 797 832 858 879 907 787 847 884 912 934 964 830 894 933 963 986 1017

888 956 998 1029 1054 1087 966 1040 1086 1120 1147 1183

1034 1113 1162 1198 1227 1266 1101 1185 1238 1276 1307 1348 1161 1250 1305 1346 1379 1422

1459 1570 1639 1690 1731 1786

171 183 190 196 200 206 270 289 301 310 317 326 320 343 357 367 375 386 363 388 404 416 425 437

401 429 446 459 469 483 436 466 485 499 510 525 468 501 521 536 548 564 499 533 554 570 583 600 527 563 586 603 616 634

564 603 627 645 659 679 615 658 684 703 719 740 659 705 733 754 770 793 703 752 782 804 822 846 743 794 826 849 868 893

938 1002 1042 1072 1095 1127

253 283 302 317 329 345 390 436 465 488 506 530 457 511 546 572 593 622 515 575 614 644 667 700

566 632 675 707 733 769 612 683 730 764 792 831 655 732 781 818 848 889 695 776 828 867 899 943 732 817 872 914 947 993

781 872 930 974 1010 1059 847 946 1009 1057 1096 1149 905 1010 1078 1128 1170 1226 962 1073 1145 1199 1243 1303

1013 1130 1206 1263 1309 1372

1263 1409 1503 1573 1630 1709

194 216 230 241 250 262 304 337 359 376 389 408 360 399 424 443 459 481 407 451 479 501 518 543

449 497 528 552 571 598 488 539 573 598 619 648 524 579 615 642 664 695 557 615 653 682 706 738 589 650 690 720 745 779

631 695 738 770 797 833 687 757 803 838 867 906 737 811 860 897 928 970 786 865 917 956 988 1033 830 913 968 1009 1043 1090

1048 1151 1219 1270 1312 1370

262 282 294 303 310 320 417 447 466 481 492 507 495 531 553 570 583 601 561 602 628 647 662 682

621 666 694 715 732 754 675 724 755 777 795 819 726 778 811 836 855 881 773 829 864 890 910 938 817 876 913 941 962 992

876 939 978 1008 1031 1062 955 1024 1067 1099 1124 1159

1025 1099 1145 1179 1206 1243 1094 1173 1222 1258 1287 1326 1156 1239 1291 1329 1360 1401

1463 1568 1634 1682 1720 1772

272 312 337 357 374 396 414 473 512 541 566 599 484 552 597 632 660 699 543 619 669 708 739 783

595 678 733 775 809 857 642 732 791 836 873 924 686 782 845 893 932 986 727 828 894 945 986 1044 765 871 941 994 1037 1098

815 927 1001 1058 1104 1168 883 1004 1084 1145 1195 1264 942 1071 1155 1220 1273 1346

1000 1136 1226 1294 1350 1428 1052 1195 1289 1361 1420 1501

1307 1482 1598 1686 1758 1858

236 254 266 275 282 291 367 396 414 427 438 453 433 467 488 503 516 533 489 527 550 568 582 601

538 580 606 625 641 662 583 628 656 677 694 717 625 673 704 726 744 768 664 715 747 771 790 816 701 755 788 813 833 860

749 806 842 869 890 919 814 876 915 944 968 999 871 937 979 1010 1035 1068 927 998 1042 1075 1101 1137 978 1052 1099 1133 1161 1198

1226 1319 1377 1420 1454 1501

271 296 312 323 333 345 415 452 476 494 508 527 486 529 557 577 594 616 545 594 625 648 666 692

598 652 685 710 731 758 646 703 740 767 789 818 691 752 791 819 843 874 732 796 837 868 893 926 770 838 881 913 939 975

821 893 939 973 1000 1038 889 967 1017 1054 1083 1124 948 1032 1084 1124 1155 1198

1007 1095 1151 1193 1226 1272 1059 1152 1211 1254 1290 1338

1315 1430 1502 1556 1600 1659

284 305 318 327 335 345 448 481 502 517 529 545 531 570 594 612 626 645 602 646 673 693 709 731

665 713 744 766 784 808 722 775 808 832 851 877 776 832 868 894 914 942 825 886 923 951 973 1002 872 936 975 1005 1028 1059

934 1002 1044 1075 1100 1134 1017 1092 1138 1172 1199 1235 1090 1170 1220 1256 1285 1324 1163 1248 1301 1339 1370 1412 1228 1318 1373 1414 1447 1491

1550 1663 1733 1784 1825 1881

262 301 326 345 361 383 398 455 493 522 545 578 464 531 574 608 635 673 519 594 643 680 711 754

569 650 704 745 778 824 613 701 758 802 838 888 654 748 809 856 895 948 692 791 856 906 946 1002 728 832 900 952 995 1054

775 885 957 1013 1058 1120 838 957 1035 1095 1143 1211 892 1019 1102 1166 1218 1289 946 1080 1168 1236 1291 1367 994 1135 1228 1298 1356 1436

1229 1403 1516 1603 1674 1772

422 477 512 539 561 591 645 727 780 821 854 899 754 850 912 959 998 1051 847 954 1024 1076 1119 1178

929 1046 1122 1180 1227 1291 1003 1129 1211 1273 1324 1393 1073 1207 1294 1360 1414 1488 1136 1278 1370 1440 1497 1576 1196 1345 1442 1516 1576 1658

1275 1433 1536 1614 1678 1766 1381 1553 1664 1748 1817 1912 1474 1656 1774 1864 1937 2038 1565 1758 1883 1978 2056 2162 1647 1849 1981 2081 2162 2274

2047 2297 2459 2582 2682 2820

301 328 345 357 368 381 478 521 547 567 583 605 567 618 650 673 692 718 643 701 737 764 785 814

711 775 815 844 868 900 773 842 885 918 943 978 831 905 952 986 1014 1052 885 964 1013 1050 1080 1120 936 1019 1071 1110 1142 1184

1002 1092 1148 1189 1223 1268 1093 1191 1252 1297 1334 1383 1173 1277 1343 1391 1430 1483 1251 1363 1433 1484 1526 1583 1322 1440 1514 1568 1612 1672

1672 1820 1914 1983 2038 2114

271 303 324 340 352 370 418 467 498 522 542 568 490 548 585 613 635 667 552 616 658 689 715 750

607 677 723 757 785 823 656 732 781 818 849 890 703 784 836 876 908 952 745 831 887 929 963 1009 785 876 934 978 1014 1063

838 934 997 1044 1082 1134 910 1014 1081 1132 1173 1230 972 1083 1155 1209 1253 1313

1033 1151 1227 1285 1331 1395 1089 1212 1292 1353 1402 1469

1359 1513 1612 1686 1747 1830

176 190 198 204 209 216 267 287 300 309 316 326 312 335 349 360 369 380 349 375 391 403 413 426

382 411 428 441 452 466 412 443 462 476 487 502 440 473 493 508 520 536 466 500 521 537 550 567 490 526 548 565 578 596

522 560 583 601 615 634 564 605 631 650 665 686 601 645 672 692 708 730 638 684 713 734 751 774 671 719 749 771 789 813

830 889 926 953 975 1005

176 198 213 224 233 246 271 305 327 344 358 377 318 358 384 403 419 442 358 403 432 454 472 496

394 442 474 498 518 545 426 478 513 539 560 589 456 512 549 576 599 630 484 543 582 611 635 668 510 573 613 644 669 703

545 611 654 687 713 750 592 663 710 745 774 814 632 708 758 796 826 869 673 753 806 846 878 923 709 794 849 890 925 972

887 992 1059 1111 1153 1211

305 330 345 357 366 379 487 527 552 570 585 605 580 627 657 679 696 720 659 713 746 771 791 818

730 789 826 854 876 906 794 859 899 929 953 986 855 924 968 1000 1026 1061 911 985 1031 1066 1093 1130 965 1043 1091 1128 1157 1196

1035 1118 1171 1209 1240 1282 1130 1221 1279 1321 1355 1401 1214 1312 1373 1418 1454 1504 1297 1401 1466 1515 1554 1606 1372 1482 1551 1602 1643 1698

315 347 368 383 395 412 495 546 578 603 622 649 586 646 684 713 736 767 663 731 774 806 832 868

732 807 854 890 918 958 794 875 927 965 997 1039 852 940 995 1036 1070 1115 906 999 1058 1102 1138 1186 957 1055 1117 1164 1201 1252

1024 1129 1195 1245 1285 1340 1116 1229 1302 1356 1399 1459 1195 1317 1394 1452 1499 1562 1274 1403 1486 1548 1597 1665 1344 1481 1568 1633 1686 1757

247 268 281 291 298 309 392 425 446 461 473 490 466 505 529 547 561 581 528 572 600 620 637 659

584 633 663 686 704 728 634 688 721 745 765 791 682 739 775 801 822 851 726 787 825 853 875 906 768 832 872 902 925 957

822 891 934 966 991 1025 897 972 1019 1053 1081 1118 962 1042 1092 1129 1159 1199

1026 1112 1165 1205 1237 1279 1084 1175 1231 1273 1306 1352

187 201 210 216 221 228 299 321 334 344 352 363 356 382 398 409 419 432 404 434 452 465 476 490

448 480 500 515 527 543 487 522 544 560 573 590 524 562 586 603 617 635 559 599 624 642 657 677 591 634 660 680 695 716

634 680 708 729 745 768 693 742 773 796 814 838 744 797 830 854 873 900 794 851 886 912 933 961 840 900 937 964 986 1016

1742 1881 1969 2033 2085 2155 1692 1865 1974 2056 2122 2212 1371 1485 1556 1609 1651 1708

The California table includes the 1.25% uniform local sales tax rate in addition to the 6% state sales tax rate for a total of 7.25%.

The Nevada table includes the 2.25% uniform local sales tax rate in addition to the 4.6000% state sales tax rate.

Residents of Salem County, New Jersey should deduct only half of the amount in the state table.

Note. Alaska does not have a state sales tax. Alaska residents should follow the instructions on the next page to determine their local sales tax amount.

1066 1142 1189 1223 1251 1288

The 4.0000% rate for Hawaii is actually an excise tax but is treated as a sales tax for purposes of this deduction.

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Which Optional Local Sales Tax Table Should I Use? IF you live in the state of... AND you live in...

THEN use Local Table...

Alaska

Arizona

Arkansas

Colorado

Adams County, Arapahoe County, Boulder County, Centennial, Colorado Springs, Denver City/Denver County, El Paso County, Larimer County, Pueblo County, or any other locality

Any locality

Any locality

C

A

B

C

Georgia

B

Mesa or Tucson

Illinois

Louisiana

New York

North Carolina Any locality

B

A

Any locality

C

A

Aurora, City of Boulder, Fort Collins, Jefferson County, Lakewood, Longmont, or City of Pueblo

Any locality

A

One of the following counties: Albany, Allegany, Broome, Cattaraugus, Cayuga, Chemung, Clinton, Cortland, Dutchess, Erie, Essex, Franklin, Fulton, Genesee, Herkimer, Jefferson, Lewis, Livingston, Monroe, Montgomery, Nassau, Niagara, Oneida, Onondaga, Ontario, Orange, Orleans, Oswego, Otsego, Putnam, Rensselaer, Rockland, St. Lawrence, Saratoga, Schenectady, Schoharie, Schuyler, Seneca, Steuben, Suffolk, Sullivan, Tompkins, Ulster, Warren, Washington, Westchester, Wyoming, or Yates Or the City of Oneida

B

Any other locality D

Chandler, Gilbert, Glendale, Peoria, Phoenix, Scottsdale, Tempe, Yuma, or any other locality

Missouri

South Carolina Newberry County

Cherokee County, Chester�eld County, Darlington County, Dillon County, Horry County, Jasper County, Lee County, Lexington County, Myrtle Beach, Charleston County, or any other locality

Tennessee Any locality

Utah Any locality

Virginia

West Virginia

Any locality

B

B

Huntington, Williamstown C Any other locality None

B

A

A

Any locality

B

Any locality

Chautauqua County, Chenango County, Columbia County, Delaware County, Greene County, Hamilton County, Madison County, Tioga County, Wayne County, New York City, or Norwich City

A

Arvada, Greeley, Thornton, Westminster C

2012 Optional Local Sales Tax Tables for Certain Local Jurisdictions (Based on a local sales tax rate of 1 percent)*

Income

At least

But less than

Exemptions

1 2 3 4 5 Over

5

$0 20,000 30,000 40,000

$20,000 30,000 40,000 50,000

50,000 60,000 70,000 80,000 90,000

60,000 70,000 80,000 90,000

100,000

100,000 120,000 140,000 160,000 180,000

120,000 140,000 160,000 180,000 200,000

200,000 or more

Local Table A Local Table B Local Table C Local Table D Exemptions

1 2 3 4 5 Over

5

Exemptions

1 2 3 4 5 Over

5

Exemptions

1 2 3 4 5 Over

5

*If your local rate is different from 1 percent, the local portion of your deduction for sales tax will be proportionally larger or smaller. See the instructions for line 3 of the State and Local General Sales Tax Deduction Worksheet.

42 46 49 51 52 54 50 56 61 64 67 71 63 72 77 82 85 90 43 46 48 49 50 52 65 71 75 78 80 84 76 86 92 97 102 107 95 108 117 123 128 136 68 72 75 78 79 82 76 84 88 92 94 98 88 100 108 114 119 125 111 126 136 143 150 158 80 86 89 92 94 97 86 94 99 103 106 111 99 112 121 127 133 140 125 141 152 160 167 177 91 97 101 104 106 109

95 104 109 113 117 122 109 123 133 140 145 154 136 155 166 176 183 193 100 107 112 115 117 121 103 112 118 123 126 132 117 133 143 151 157 166 147 166 179 189 197 208 109 117 121 125 128 131 110 120 127 132 135 141 126 142 153 161 168 177 157 178 191 202 210 222 117 125 130 134 137 141 117 128 134 140 144 149 133 150 162 170 177 187 166 188 202 213 222 235 125 133 139 143 146 150 123 135 142 147 151 157 140 158 170 179 187 197 174 198 213 224 234 246 132 141 147 151 154 159

132 144 151 157 162 168 149 168 181 191 199 209 186 210 226 238 248 262 141 151 157 161 165 170 143 156 164 171 176 182 162 182 196 206 215 227 201 227 244 258 268 283 154 165 171 176 180 185 153 167 176 182 188 195 172 195 209 220 229 241 214 242 260 274 286 301 165 176 183 189 193 198 163 178 187 194 200 207 183 206 222 233 243 256 227 256 276 291 303 319 176 188 196 201 206 212 172 187 197 204 210 218 193 217 233 245 255 269 238 269 290 305 318 335 186 199 207 212 217 223

216 235 247 256 263 273 239 269 289 304 317 333 295 333 358 377 392 414 235 251 261 268 274 282

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Department of the Treasury Internal Revenue Service

2012 Instructions for Schedule C Profit or Loss From Business

Use Schedule C (Form 1040) to report income or loss from a business you operated or a profession you practiced as a sole proprietor. An activity qualifies as a business if your primary purpose for engaging in the activity is for income or profit and you are involved in the activity with continuity and regularity. For example, a sporadic activity or a hobby does not qualify as a business. To report income from a nonbusiness activi- ty, see the instructions for Form 1040, line 21, or Form 1040NR, line 21.

Also use Schedule C to report (a) wages and expenses you had as a statutory em- ployee, (b) income and deductions of certain qualified joint ventures, and (c) certain income shown on Form 1099-MISC, Miscellaneous Income. See the Instructions for Recipient (back of Copy B of Form 1099-MISC) for the types of income to report on Schedule C.

Small businesses and statutory employees with business expenses of $5,000 or less may be able to file Schedule C-EZ instead of Schedule C. See Schedule C-EZ for de- tails.

You may be subject to state and local taxes and other requirements such as business licenses and fees. Check with your state and local governments for more information.

Section references are to the Internal Revenue Code unless otherwise noted.

Future Developments For the latest information about devel- opments related to Schedule C (Form 1040) and its instructions, such as legis- lation enacted after they were published, go to www.irs.gov/schedulec.

What's New No separate payment card reporting requirements. Gross receipts received via payment card (credit and debit cards) and third party network payments are not separately reported on Schedule C. Standard mileage rate. The business standard mileage rate for 2012 is 55.5 cents per mile. Heavy highway vehicle use tax. This tax has been extended through Septem- ber 30, 2017.

General Instructions Other Schedules and Forms You May Have To File

Schedule A (Form 1040) to deduct interest, taxes, and casualty losses not related to your business.

Schedule E (Form 1040) to report rental real estate and royalty income or

(loss) that is not subject to self-employment tax.

Schedule F (Form 1040) to report profit or (loss) from farming.

Schedule J (Form 1040) to figure your tax by averaging your farming or fishing income over the previous 3 years. Doing so may reduce your tax.

Schedule SE (Form 1040) to pay self-employment tax on income from any trade or business.

Form 3800 to claim any of the general business credits.

Form 4562 to claim depreciation (including the special allowance) on assets placed in service in 2012, to claim amortization that began in 2012, to make an election under section 179 to expense certain property, or to report information on listed property.

Form 4684 to report a casualty or theft gain or loss involving property used in your trade or business or income-producing property.

Form 4797 to report sales, exchanges, and involuntary conversions (not from a casualty or theft) of trade or business property.

Form 6198 to figure your allowable loss if you have a business loss and you have amounts invested in the business for which you are not at risk.

Form 8582 to figure your allowable loss from passive activities.

Form 8594 to report certain purchases or sales of groups of assets that constitute a trade or business.

Form 8824 to report like-kind exchanges.

Form 8829 to claim expenses for business use of your home.

Form 8903 to take a deduction for income from domestic production activities. Single-member limited liability com- pany (LLC). Generally, a single-mem- ber domestic LLC is not treated as a sep- arate entity for federal income tax purposes. If you are the sole member of a domestic LLC, file Schedule C or C-EZ (or Schedule E or F, if applicable). However, you can elect to treat a domes- tic LLC as a corporation. See Form 8832 for details on the election and the tax treatment of a foreign LLC. Single-member limited liability com- panies (LLCs) with employees. Sin- gle-member LLCs that are disregarded as entities separate from their owner for federal income tax purposes are now re- quired to file employment tax returns us- ing the LLC's name and employer iden- tification number (EIN) rather than the LLC owner's name and EIN. Sin- gle-member LLCs not previously need- ing an EIN may now need to obtain an EIN for the payment and reporting of those taxes. For more information, see the Instructions for Form SS-4.

C-1 Dec 11, 2012 Cat. No. 24329W

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Heavy highway vehicle use tax. If you use certain highway trucks, truck-trail- ers, tractor-trailers, or buses in your trade or business, you may have to pay a federal highway motor vehicle use tax. See the Instructions for Form 2290 to find out if you must pay this tax and vis- it www.irs.gov/trucker for the most re- cent developments. Information returns. You may have to file information returns for wages paid to employees, certain payments of fees and other nonemployee compensation, interest, rents, royalties, real estate trans- actions, annuities, and pensions. See Line I, later, and the 2012 General In- structions for Certain Information Re- turns for details and other payments that may require you to file a Form 1099.

If you received cash of more than $10,000 in one or more related transac- tions in your trade or business, you may have to file Form 8300. For details, see Pub. 1544.

Husband-Wife Qualified Joint Venture If you and your spouse each materially participate (see Material participation, later, in the instructions for line G) as the only members of a jointly owned and operated business and you file a joint return for the tax year, you can elect to be treated as a qualified joint venture instead of a partnership. This election, in most cases, will not increase the total tax owed on the joint return, but it does give each of you credit for social security earnings on which retirement benefits are based and for Medicare cov- erage. By making the election, you will not be required to file Form 1065 for any year the election is in effect and will instead report the income and deduc- tions directly on your joint return. If you and your spouse filed a Form 1065 for the year prior to the election, the part- nership terminates at the end of the tax year immediately preceding the year the election takes effect.

Note. Mere joint ownership of property that is not a trade or business does not qualify for the election. Making the election. To make this election, you must divide all items of in- come, gain, loss, deduction, and credit attributable to the business between you and your spouse in accordance with your

respective interests in the venture. Each of you must file a separate Schedule C, C-EZ, or F. On each line of your sepa- rate Schedule C, C-EZ, or F, you must enter your share of the applicable in- come, deduction, or loss. Each of you must also file a separate Schedule SE to pay self-employment tax, as applicable.

Once made, the election can be re- voked only with the permission of the IRS. However, the election technically remains in effect only for as long as the spouses filing as a qualified joint ven- ture continue to meet the requirements for filing the election. If the spouses fail to meet the qualified joint venture re- quirements for a year, a new election will be necessary for any future year in which the spouses meet the require- ments to be treated as a qualified joint venture.

The election generally does not re- quire that you and your spouse obtain an employer identification number (EIN) since you and your spouse will file as sole proprietors. However, you may need an EIN to file other returns such as employment or excise tax returns. To apply for an EIN, see the Instructions for Form SS-4.

For more information on qualified joint ventures, go to IRS.gov. Enter “qualified joint venture” in the search box and select “Election for Husband and Wife Unincorporated Businesses.” Rental real estate business. If you and your spouse make the election for your rental real estate business, you must each report your share of income and deductions on Schedule E. Rental real estate income generally is not included in net earnings from self-employment subject to self-employment tax and gen- erally is subject to the passive loss limi- tation rules. Electing qualified joint ven- ture status does not alter the application of the self-employment tax or the pas- sive loss limitation rules.

Husband-Wife Partnership Generally, if you and your spouse joint- ly own and operate an unincorporated business and share in the profits and los- ses, you are partners in a partnership, whether or not you have a formal part- nership agreement. You generally have to file Form 1065 instead of Schedule C or C-EZ for your joint business activity;

however, you may not have to file Form 1065 if either of the following applies.

You and your spouse elect to be treated as a qualified joint venture. See Husband-Wife Qualified Joint Venture, earlier.

You and your spouse wholly own the unincorporated business as commun- ity property. See Exception—community income next. Otherwise, use Form 1065. See Pub. 541 for more details. Exception—community income. If you and your spouse wholly own an un- incorporated business as community property under the community property laws of a state, foreign country, or U.S. possession, the income and deductions are reported as follows.

If only one spouse participates in the business, all of the income from that business is the self-employment earn- ings of the spouse who carried on the business.

If both spouses participate, the in- come and deductions are allocated to the spouses based on their distributive shares.

If either or both you and your spouse are partners in a partnership, see Pub. 541.

If you and your spouse elected to treat the business as a qualifying joint venture, see Husband-Wife Qualified Joint Venture, earlier.

The only states with community property laws are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. A change in your reporting position will be treated as a conversion of the entity.

Reportable Transaction Disclosure Statement Use Form 8886 to disclose information for each reportable transaction in which you participated. Form 8886 must be filed for each tax year that your federal income tax liability is affected by your participation in the transaction. You may have to pay a penalty if you are required to file Form 8886 but do not do so. You may also have to pay interest and penal- ties on any reportable transaction under- statements. The following are reportable transactions.

Any listed transaction that is the same as or substantially similar to tax

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avoidance transactions identified by the IRS.

Any transaction offered to you or a related party under conditions of confi- dentiality for which you paid an advisor a fee of at least $50,000.

Certain transactions for which you or a related party have contractual pro- tection against disallowance of the tax benefits.

Certain transactions resulting in a loss of at least $2 million in any single tax year or $4 million in any combina- tion of tax years. (At least $50,000 for a single tax year if the loss arose from a foreign currency transaction defined in section 988(c)(1), whether or not the loss flows through from an S corpora- tion or partnership.)

Certain transactions of interest en- tered into after November 1, 2006, that are the same or substantially similar to one of the types of transactions that the IRS has identified by published guid- ance as a transaction of interest.

See the Instructions for Form 8886 for more details.

Capital Construction Fund Do not claim on Schedule C or C-EZ the deduction for amounts contributed to a capital construction fund set up under chapter 535 of title 46 of the United States Code. Instead, reduce the amount you would otherwise enter on Form 1040, line 43, by the amount of the de- duction. Next to line 43, enter “CCF” and the amount of the deduction. For de- tails, see Pub. 595.

Additional Information See Pub. 334 for more information for small businesses.

Specific Instructions Filers of Form 1041. Do not complete the block labeled “Social security num- ber (SSN).” Instead, enter the employer identification number (EIN) issued to the estate or trust on line D.

Line A Describe the business or professional ac- tivity that provided your principal source of income reported on line 1. If you owned more than one business, you must complete a separate Schedule C for

each business. Give the general field or activity and the type of product or serv- ice. If your general field or activity is wholesale or retail trade, or services connected with production services (mining, construction, or manufactur- ing), also give the type of customer or client. For example, “wholesale sale of hardware to retailers” or “appraisal of real estate for lending institutions.”

Line B Enter on line B the six-digit code from the Principal Business or Professional Activity Codes chart at the end of these instructions.

Line D Enter on line D the employer identifica- tion number (EIN) that was issued to you on Form SS-4. Do not enter your SSN on this line. Do not enter another taxpayer's EIN (for example, from any Forms 1099-MISC that you received). If you do not have an EIN, leave line D blank.

You need an EIN only if you have a qualified retirement plan or are required to file employment, excise, alcohol, to- bacco, or firearms returns, or are a payer of gambling winnings. If you need an EIN, See the Instructions for Form SS-4. Single-member LLCs. If you are the sole owner of an LLC that is not treated as a separate entity for federal income tax purposes, you may have an EIN that was issued to the LLC (and in the LLC's legal name) if you are required to file employment tax returns and certain ex- cise tax returns. However, you should enter on line D only the EIN issued to you and in your name as a sole pro- prietor. If you do not have such an EIN, leave line D blank. Do not enter on line D the EIN issued to the LLC.

Line E Enter your business address. Show a street address instead of a box number. Include the suite or room number, if any. If you conducted the business from your home located at the address shown on Form 1040, page 1, you do not have to complete this line.

Line F Generally, you can use the cash method, accrual method, or any other method permitted by the Internal Revenue Code. In all cases, the method used must clear- ly reflect income. Unless you are a qual- ifying taxpayer or a qualifying small business taxpayer (see the Part III in- structions), you must use the accrual method for sales and purchases of inven- tory items. Special rules apply to long-term contracts (see section 460 for details).

If you use the cash method, show all items of taxable income actually or con- structively received during the year (in cash, property, or services). Income is constructively received when it is credi- ted to your account or set aside for you to use. Also, show amounts actually paid during the year for deductible expenses. However, if the payment of an expendi- ture creates an asset having a useful life that extends substantially beyond the close of the year, it may not be deducti- ble or may be deductible only in part for the year of the payment. See chapter 1 of Pub. 535.

If you use the accrual method, report income when you earn it and deduct ex- penses when you incur them even if you do not pay them during the tax year. Ac- crual-basis taxpayers are put on a cash basis for deducting business expenses owed to a related cash-basis taxpayer. Other rules determine the timing of de- ductions based on economic perform- ance. See Pub. 538.

To change your accounting method, you generally must file Form 3115. You also may have to make an adjustment to prevent amounts of income or expense from being duplicated or omitted. This is called a section 481(a) adjustment.

Example. You change to the cash method of accounting and choose to ac- count for inventoriable items in the same manner as materials and supplies that are not incidental. You accrued sales in 2011 for which you received payment in 2012. You must report those sales in both years as a result of changing your accounting method and must make a section 481(a) adjustment to prevent du- plication of income.

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A net negative section 481(a) adjust- ment is taken into account entirely in the year of the change. A net positive sec- tion 481(a) adjustment is generally taken into account over a period of 4 years. In- clude any net positive section 481(a) ad- justments on line 6. If the net section 481(a) adjustment is negative, report it in Part V.

For details on figuring section 481(a) adjustments, see the Instructions for Form 3115, and Rev. Proc. 2006-12, 2006-3 I.R.B. 310, available at www.irs.gov/irb/2006-03_IRB/ ar14.html. Also see Rev. Proc. 2006-37, 2006-38 I.R.B. 499, available at www.irs.gov/irb/2006-38_IRB/ ar10.html.

Line G If your business activity was not a rental activity and you met any of the material participation tests, explained next, or the exception for oil and gas applies (ex- plained later), check the “Yes” box. Oth- erwise, check the “No” box. If you check the “No” box, this business is a passive activity. If you have a loss from this business, see Limit on losses, later. If you have a profit from this business activity but have current year losses from other passive activities or you have prior year unallowed passive activity losses, see the Instructions for Form 8582.

Material participation. For purposes of the seven material participation tests listed later, participation generally in- cludes any work you did in connection with an activity if you owned an interest in the activity at the time you did the work. The capacity in which you did the work does not matter. However, work is not treated as participation if it is work that an owner would not customarily do in the same type of activity and one of your main reasons for doing the work was to avoid the disallowance of losses or credits from the activity under the passive activity rules.

Work you did as an investor in an ac- tivity is not treated as participation un- less you were directly involved in the day-to-day management or operations of the activity. Work done as an investor includes:

Studying and reviewing financial statements or reports on the activity,

Preparing or compiling summaries or analyses of the finances or operations of the activity for your own use, and

Monitoring the finances or opera- tions of the activity in a nonmanagerial capacity.

Participation by your spouse during the tax year in an activity you own can be counted as your participation in the activity. This rule applies even if your spouse did not own an interest in the ac- tivity and whether or not you and your spouse file a joint return. However, this rule does not apply for purposes of de- termining whether you and your spouse can elect to have your business treated as a qualified joint venture instead of a partnership (see Husband-Wife Quali- fied Joint Venture, earlier).

For purposes of the passive activity rules, you materially participated in the operation of this trade or business activi- ty during 2012 if you met any of the fol- lowing seven tests.

1. You participated in the activity for more than 500 hours during the tax year.

2. Your participation in the activity for the tax year was substantially all of the participation in the activity of all in- dividuals (including individuals who did not own any interest in the activity) for the tax year.

3. You participated in the activity for more than 100 hours during the tax year, and you participated at least as much as any other person for the tax year. This includes individuals who did not own any interest in the activity.

4. The activity is a significant par- ticipation activity for the tax year, and you participated in all significant partici- pation activities for more than 500 hours during the year. An activity is a “signifi- cant participation activity” if it involves the conduct of a trade or business, you participated in the activity for more than 100 hours during the tax year, and you did not materially participate under any of the material participation tests (other than this test 4).

5. You materially participated in the activity for any 5 of the prior 10 tax years.

6. The activity is a personal service activity in which you materially partici- pated for any 3 prior tax years. A per- sonal service activity is an activity that

involves performing personal services in the fields of health, law, engineering, ar- chitecture, accounting, actuarial science, performing arts, consulting, or any other trade or business in which capital is not a material income-producing factor.

7. Based on all the facts and circum- stances, you participated in the activity on a regular, continuous, and substantial basis for more than 100 hours during the tax year.Your participation in managing the activity does not count in determin- ing if you meet this test if any person (except you) (a) received compensation for performing management services in connection with the activity, or (b) spent more hours during the tax year than you spent performing management services in connection with the activity (regard- less of whether the person was compen- sated for the services).

Rental of property. Generally, a rental activity (such as long-term equipment leasing or rental real estate) is a passive activity even if you materially participa- ted in the activity. However, if you ma- terially participated in a rental real estate activity as a real estate professional, it is not a passive activity. Also, if you met any of the five exceptions listed under Rental Activities in the Instructions for Form 8582, the rental of the property is not treated as a rental activity and the material participation rules earlier apply. See Activities That Are Not Passive Ac- tivities in the Instructions for Form 8582 for the definition of a real estate profes- sional. Exception for oil and gas. If you are filing Schedule C to report income and deductions from an oil or gas well in which you own a working interest di- rectly or through an entity that does not limit your liability, check the “Yes” box. The activity of owning a working inter- est is not a passive activity, regardless of your participation. Limit on losses. Your loss may be limi- ted if you checked the “No” box on line G. In this case, you may have a loss from a passive activity, and you may have to use Form 8582 to figure your al- lowable loss, if any, to enter on Sched- ule C, line 31.

Generally, you can deduct losses from passive activities only to the extent of income from passive activities. For details, see Pub. 925.

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Line H If you started or acquired this business in 2012, check the box on line H. Also check the box if you are reopening or re- starting this business after temporarily closing it, and you did not file a 2011 Schedule C or C-EZ for this business.

Line I If you made any payment in 2012 that would require you to file any Forms 1099, check the “Yes” box. Otherwise, check the “No” box.

You may have to file information re- turns for wages paid to employees, cer- tain payments of fees and other nonem- ployee compensation, interest, rents, royalties, real estate transactions, annui- ties, and pensions. You may also have to file an information return if you sold $5,000 or more of consumer products to a person on a buy-sell, deposit-commis- sion, or other similar basis for resale.

The Guide to Information Re- turns in the 2012 General In- structions for Certain Informa-

tion Returns identifies which Forms 1099 must be filed, the amounts to re- port, and the due dates for the required Forms 1099.

Part I. Income Except as otherwise provided in the In- ternal Revenue Code, gross income in- cludes income from whatever source de- rived. In certain circumstances, howev- er, gross income does not include extra- territorial income that is qualifying for- eign trade income. Use Form 8873 to figure the extraterritorial income exclu- sion. Report it on Schedule C as ex- plained in the Instructions for Form 8873.

If you were a debtor in a chapter 11 bankruptcy case during 2012, see Chap- ter 11 Bankruptcy Cases under Income in the Instructions for Form 1040 and the Instructions for Schedule SE (Form 1040).

Line 1 Enter gross receipts from your trade or business. Include amounts you received in your trade or business that were prop-

TIP

erly shown on Forms 1099-MISC. If the total amounts that were reported in box 7 of Forms 1099-MISC are more than the total you are reporting on line 1, attach a statement explaining the differ- ence. Statutory employees. If you received a Form W-2 and the "Statutory employee" box in box 13 of that form was checked, report your income and expenses related to that income on Schedule C or C-EZ. Enter your statutory employee income from box 1 of Form W-2 on line 1 of Schedule C or C-EZ and check the box on that line. Social security and Medi- care tax should have been withheld from your earnings; as a result, you do not owe self-employment tax on these earn- ings. Statutory employees include full-time life insurance agents, certain agent or commission drivers and travel- ing salespersons, and certain homework- ers.

If you had both self-employment in- come and statutory employee income, you must file two Schedules C. You cannot use Schedule C-EZ or combine these amounts on a single Schedule C.

Qualified joint ventures should report rental real estate in- come not subject to self-em-

ployment tax on Schedule E. See Hus- band-Wife Qualified Joint Venture, ear- lier, and the Instructions for Schedule E.

Installment sales. Generally, the in- stallment method cannot be used to re- port income from the sale of (a) personal property regularly sold under the install- ment method, or (b) real property held for resale to customers. But the install- ment method can be used to report in- come from sales of certain residential lots and timeshares if you elect to pay interest on the tax due on that income af- ter the year of sale. See section 453(l)(2) (B) for details. If you make this election, include the interest in the total on Form 1040, line 60. Also, enter “453(l)(3)” and the amount of the interest on the dotted line to the left of line 60.

If you use the installment method, at- tach a schedule to your return. Show separately for 2012 and the 3 preceding years: gross sales, cost of goods sold, gross profit, percentage of gross profit to gross sales, amounts collected, and gross profit on amounts collected.

CAUTION !

Line 6 Report on line 6 amounts from finance reserve income, scrap sales, bad debts you recovered, interest (such as on notes and accounts receivable), state gasoline or fuel tax refunds you received in 2012, the amount of credit claimed on Form 6478 or Form 8864, credit for federal tax paid on fuels claimed on your 2011 Form 1040, prizes and awards related to your trade or business, and other kinds of miscellaneous business income. In- clude amounts you received in your trade or business as shown on Form 1099-PATR.

If the business use percentage of any listed property (defined in Line 13, later) dropped to 50% or less in 2012, report on this line any recapture of excess de- preciation, including any section 179 ex- pense deduction. Use Part IV of Form 4797 to figure the recapture. Also, if the business use percentage drops to 50% or less on leased listed property (other than a vehicle), include on this line any inclu- sion amount. See chapter 5 of Pub. 946 to figure the amount.

Part II. Expenses Capitalizing costs of property. If you produced real or tangible personal prop- erty or acquired property for resale, cer- tain expenses attributable to the property generally must be included in inventory costs or capitalized. In addition to direct costs, producers of inventory property generally must also include part of cer- tain indirect costs in their inventory. Purchasers of personal property acquired for resale must include part of certain in- direct costs in inventory only if the aver- age annual gross receipts for the 3 prior tax years exceed $10 million. Also, you must capitalize part of the indirect costs that benefit real or tangible personal property constructed for use in a trade or business, or noninventory property pro- duced for sale to customers. Reduce the amounts on lines 8 through 26 and Part V by amounts capitalized. See Pub. 538 for a discussion of uniform capitaliza- tion rules.

Exception for certain producers. Producers who account for inventoriable items in the same manner as materials and supplies that are not incidental can

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currently deduct expenditures for direct labor and all indirect costs that would otherwise be included in inventory costs. See Part III. Cost of Goods Sold for more details.

Exception for creative property. If you are a freelance artist, author, or pho- tographer, you may be exempt from the capitalization rules. However, your per- sonal efforts must have created (or rea- sonably be expected to create) the prop- erty. This exception does not apply to any expense related to printing, photo- graphic plates, motion picture films, vid- eo tapes, or similar items. These expen- ses are subject to the capitalization rules. For details, see Uniform Capitalization Rules in Pub. 538.

Line 9 You can deduct the actual expenses of operating your car or truck or take the standard mileage rate. This is true even if you used your vehicle for hire (such as a taxicab). You must use actual expen- ses if you used five or more vehicles si- multaneously in your business (such as in fleet operations). You cannot use ac- tual expenses for a leased vehicle if you previously used the standard mileage rate for that vehicle.

You can take the standard mileage rate for 2012 only if you:

Owned the vehicle and used the standard mileage rate for the first year you placed the vehicle in service, or

Leased the vehicle and are using the standard mileage rate for the entire lease period (except the period, if any, before 1998).

If you take the standard mileage rate:

Multiply the number of business miles driven by 55.5 cents and

Add to this amount your parking fees and tolls, and enter the total on line 9.

Do not deduct depreciation, rent or lease payments, or your actual operating expenses.

If you deduct actual expenses: Include on line 9 the business por-

tion of expenses for gasoline, oil, re- pairs, insurance, tires, license plates, etc., and

Show depreciation on line 13 and rent or lease payments on line 20a.

For details, see chapter 4 of Pub. 463. Information on your vehicle. If you claim any car and truck expenses, you must provide certain information on the use of your vehicle by completing one of the following.

Schedule C, Part IV, or Sched- ule C-EZ, Part III, if: (a) you are claim- ing the standard mileage rate, you lease your vehicle, or your vehicle is fully de- preciated, and (b) you are not required to file Form 4562 for any other reason. If you used more than one vehicle during the year, attach your own schedule with the information requested in Schedule C, Part IV, or Schedule C-EZ, Part III, for each additional vehicle.

Form 4562, Part V, if you are claiming depreciation on your vehicle or you are required to file Form 4562 for any other reason (see Line 13, later).

Line 11 Enter the total cost of contract labor for the tax year. Contract labor includes payments to persons you do not treat as employees (for example, independent contractors) for services performed for your trade or business. Do not include contract labor deducted elsewhere on your return, such as contract labor in- cludible on line 17, 21, 26, or 37. Also, do not include salaries and wages paid to your employees; instead, see Line 26, later.

You must file Form 1099-MISC, Miscellaneous Income, to report con- tract labor payments of $600 or more during the year. See the Instructions for Form 1099-MISC for details.

Line 12 Enter your deduction for depletion on this line. If you have timber depletion, attach Form T. See chapter 9 of Pub. 535 for details.

Line 13 Depreciation and section 179 expense deduction. Depreciation is the annual deduction allowed to recover the cost or other basis of business or investment property having a useful life substantial- ly beyond the tax year. You can also de- preciate improvements made to leased business property. However, stock in trade, inventories, and land are not de-

preciable. Depreciation starts when you first use the property in your business or for the production of income. It ends when you take the property out of serv- ice, deduct all your depreciable cost or other basis, or no longer use the property in your business or for the production of income. You can also elect under sec- tion 179 to expense part or all of the cost of certain property you bought in 2012 for use in your business. See the Instruc- tions for Form 4562 and Pub. 946 to fig- ure the amount to enter on line 13. When to attach Form 4562. You must complete and attach Form 4562 only if you are claiming:

Depreciation on property placed in service during 2012;

Depreciation on listed property (defined later), regardless of the date it was placed in service; or

A section 179 expense deduction. If you acquired depreciable property

for the first time in 2012, see Pub. 946. Listed property generally includes

but is not limited to: Passenger automobiles weighing

6,000 pounds or less; Any other property used for trans-

portation if the nature of the property lends itself to personal use, such as mo- torcycles, pickup trucks, etc.;

Any property used for entertain- ment or recreational purposes (such as photographic, phonographic, communi- cation, and video recording equipment); and

Computers or peripheral equip- ment. Exceptions. Listed property does not include photographic, phonographic, communication, or video equipment used exclusively in your trade or busi- ness or at your regular business estab- lishment. It also does not include any computer or peripheral equipment used exclusively at a regular business estab- lishment and owned or leased by the person operating the establishment. For purposes of these exceptions, a portion of your home is treated as a regular busi- ness establishment only if that portion meets the requirements under section 280A(c)(1) for deducting expenses for the business use of your home.

See Line 6, earlier, if the business use percentage of any listed property drop- ped to 50% or less in 2012.

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Line 14 Deduct contributions to employee bene- fit programs that are not an incidental part of a pension or profit-sharing plan included on line 19. Examples are acci- dent and health plans, group-term life insurance, and dependent care assistance programs. If you made contributions on your behalf as a self-employed person to a dependent care assistance program, complete Form 2441, Parts I and III, to figure your deductible contributions to that program.

You cannot deduct contributions you made on your behalf as a self-employed person for group-term life insurance.

Do not include on line 14 any contri- butions you made on your behalf as a self-employed person to an accident and health plan. However, you may be able to deduct on Form 1040, line 29, or Form 1040NR, line 29, the amount you paid for health insurance on behalf of yourself, your spouse, and dependents, even if you do not itemize your deduc- tions. See the instructions for Form 1040, line 29, or Form 1040NR, line 29, for details.

You must reduce your line 14 deduc- tion by the amount of any credit for small employer health insurance premi- ums determined on Form 8941. See Form 8941 and its instructions to deter- mine which expenses are eligible for the credit.

Line 15 Deduct premiums paid for business in- surance on line 15. Deduct on line 14 amounts paid for employee accident and health insurance. Do not deduct amounts credited to a reserve for self-insurance or premiums paid for a policy that pays for your lost earnings due to sickness or disability. For details, see chapter 6 of Pub. 535.

Lines 16a and 16b Interest allocation rules. The tax treat- ment of interest expense differs depend- ing on its type. For example, home mortgage interest and investment inter- est are treated differently. “Interest allo- cation” rules require you to allocate (classify) your interest expense so it is deducted (or capitalized) on the correct

line of your return and receives the right tax treatment. These rules could affect how much interest you are allowed to deduct on Schedule C or C-EZ.

Generally, you allocate interest ex- pense by tracing how the proceeds of the loan were used. See chapter 4 of Pub. 535 for details.

If you paid interest on a debt secured by your main home and any of the pro- ceeds from that debt were used in con- nection with your trade or business, see chapter 4 of Pub. 535 to figure the amount that is deductible on Schedule C or C-EZ. How to report. If you have a mortgage on real property used in your business (other than your main home), enter on line 16a the interest you paid for 2012 to banks or other financial institutions for which you received a Form 1098 (or similar statement). If you did not receive a Form 1098, enter the interest on line 16b.

If you paid more mortgage interest than is shown on Form 1098, see chap- ter 4 of Pub. 535 to find out if you can deduct the additional interest. If you can, include the amount on line 16a. Attach a statement to your return explaining the difference and enter “See attached” in the margin next to line 16a.

If you and at least one other person (other than your spouse if you file a joint return) were liable for and paid interest on the mortgage and the other person re- ceived the Form 1098, include your share of the interest on line 16b. Attach a statement to your return showing the name and address of the person who re- ceived the Form 1098. In the margin next to line 16b, enter “See attached.”

If you paid interest in 2012 that also applies to future years, deduct only the part that applies to 2012.

Line 17 Include on this line fees charged by ac- countants and attorneys that are ordinary and necessary expenses directly related to operating your business.

Include fees for tax advice related to your business and for preparation of the tax forms related to your business. Also include expenses incurred in resolving asserted tax deficiencies relating to your business.

For more information, see Pub. 334 or 535.

Line 18 Include on this line your expenses for office supplies and postage.

Line 19 Enter your deduction for contributions to a pension, profit-sharing, or annuity plan, or plan for the benefit of your em- ployees. If the plan included you as a self-employed person, enter contribu- tions made as an employer on your be- half on Form 1040, line 28, or Form 1040NR, line 28, not on Schedule C.

In most cases, you must file the ap- plicable form listed below if you main- tain a pension, profit-sharing, or other funded-deferred compensation plan. The filing requirement is not affected by whether or not the plan qualified under the Internal Revenue Code, or whether or not you claim a deduction for the cur- rent tax year. There is a penalty for fail- ure to timely file these forms. Form 5500-EZ. File this form if you have a one-participant retirement plan that meets certain requirements. A one-participant plan is a plan that covers only you (or you and your spouse). Form 5500-SF. File this form if you have a small plan (fewer than 100 par- ticipants in most cases) that meets cer- tain requirements. Form 5500. File this form for a plan that does not meet the requirements for filing Form 5500-EZ or Form 5500-SF.

For details, see Pub. 560.

Lines 20a and 20b If you rented or leased vehicles, machi- nery, or equipment, enter on line 20a the business portion of your rental cost. But if you leased a vehicle for a term of 30 days or more, you may have to reduce your deduction by an amount called the inclusion amount. See Leasing a Car in chapter 4 of Pub. 463 to figure this amount.

Enter on line 20b amounts paid to rent or lease other property, such as of- fice space in a building.

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Line 21 Deduct the cost of incidental repairs and maintenance that do not add to the prop- erty's value or appreciably prolong its life. Do not deduct the value of your own labor. Do not deduct amounts spent to restore or replace property; they must be capitalized.

Line 22 In most cases, you can deduct the cost of materials and supplies only to the extent you actually consumed and used them in your business during the tax year (unless you deducted them in a prior tax year). However, if you had incidental materials and supplies on hand for which you kept no inventories or records of use, you can deduct the cost of those you actually purchased during the tax year, provided that method clearly reflects income.

You can also deduct the cost of books, professional instruments, equip- ment, etc., if you normally use them within a year. However, if their useful- ness extends substantially beyond a year, you must generally recover their costs through depreciation.

Line 23 You can deduct the following taxes and licenses on this line.

State and local sales taxes imposed on you as the seller of goods or services. If you collected this tax from the buyer, you must also include the amount col- lected in gross receipts or sales on line 1.

Real estate and personal property taxes on business assets.

Licenses and regulatory fees for your trade or business paid each year to state or local governments. But some li- censes, such as liquor licenses, may have to be amortized. See chapter 8 of Pub. 535 for details.

Social security and Medicare taxes paid to match required withholding from your employees' wages. Reduce your de- duction by the amount shown on Form 8846, line 4.

Federal unemployment tax paid. Federal highway use tax. Contributions to state unemploy-

ment insurance fund or disability benefit fund if they are considered taxes under state law.

Do not deduct the following. Federal income taxes, including

your self-employment tax. However, you can deduct a portion of your self-employment tax on Form 1040, line 27, (or Form 1040NR, line 27, when covered under the U.S. social security system due to an international social se- curity agreement).

Estate and gift taxes. Taxes assessed to pay for improve-

ments, such as paving and sewers. Taxes on your home or personal

use property. State and local sales taxes on prop-

erty purchased for use in your business. Instead, treat these taxes as part of the cost of the property.

State and local sales taxes imposed on the buyer that you were required to collect and pay over to state or local governments. These taxes are not inclu- ded in gross receipts or sales nor are they a deductible expense. However, if the state or local government allowed you to retain any part of the sales tax you collected, you must include that amount as income on line 6.

Other taxes and license fees not re- lated to your business.

Line 24a Enter your expenses for lodging and transportation connected with overnight travel for business while away from your tax home. In most cases, your tax home is your main place of business, re- gardless of where you maintain your family home. You cannot deduct expen- ses paid or incurred in connection with employment away from home if that pe- riod of employment exceeds 1 year. Al- so, you cannot deduct travel expenses for your spouse, your dependent, or any other individual unless that person is your employee, the travel is for a bona fide business purpose, and the expenses would otherwise be deductible by that person.

Do not include expenses for meals and entertainment on this line. Instead, see Line 24b, later.

Instead of keeping records of your actual incidental expenses, you can use an optional method for deducting inci- dental expenses only if you did not pay or incur meal expenses on a day you were traveling away from your tax

home. The amount of the deduction is $5 a day. Incidental expenses include fees and tips given to porters, baggage carriers, bellhops, hotel maids, stewards or stewardesses and others on ships, and hotel servants in foreign countries. They do not include expenses for laundry, cleaning and pressing of clothing, lodg- ing taxes, or the costs of telegrams or telephone calls. You cannot use this method on any day that you use the standard meal allowance (as explained in Line 24b, later).

You cannot deduct expenses for at- tending a convention, seminar, or simi- lar meeting held outside the North American area unless the meeting is di- rectly related to your trade or business and it is as reasonable for the meeting to be held outside the North American area as within it. These rules apply to both employers and employees. Other rules apply to luxury water travel.

For details on travel expenses, see chapter 1 of Pub. 463.

Line 24b Enter your total deductible business meal and entertainment expenses. This includes expenses for meals while trav- eling away from home for business and for meals that are business-related enter- tainment. Deductible expenses. Business meal expenses are deductible only if they are (a) directly related to or associated with the active conduct of your trade or busi- ness, (b) not lavish or extravagant, and (c) incurred while you or your employee is present at the meal.

You cannot deduct any expense paid or incurred for a facility (such as a yacht or hunting lodge) used for any activity usually considered entertainment, amusement, or recreation.

Also, you cannot deduct membership dues for any club organized for busi- ness, pleasure, recreation, or other social purpose. This includes country clubs, golf and athletic clubs, airline and hotel clubs, and clubs operated to provide meals under conditions favorable to business discussion. But it does not in- clude civic or public service organiza- tions, professional organizations (such as bar and medical associations), busi- ness leagues, trade associations, cham- bers of commerce, boards of trade, and

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real estate boards, unless a principal pur- pose of the organization is to entertain, or provide entertainment facilities for, members or their guests.

There are exceptions to these rules as well as other rules that apply to skybox rentals and tickets to entertainment events. See chapters 1 and 2 of Pub. 463. Standard meal allowance. Instead of deducting the actual cost of your meals while traveling away from home, you can use the standard meal allowance for your daily meals and incidental expen- ses. Under this method, you deduct a specified amount, depending on where you travel, instead of keeping records of your actual meal expenses. However, you must still keep records to prove the time, place, and business purpose of your travel.

The standard meal allowance is the federal M&IE rate. You can find these rates on the Internet at www.gsa.gov. Click on “Per Diem Rates” for links to locations inside and outside the conti- nental United States.

See chapter 1 of Pub. 463 for details on how to figure your deduction using the standard meal allowance, including special rules for partial days of travel. Amount of deduction. In most cases, you can deduct only 50% of your busi- ness meal and entertainment expenses, including meals incurred while away from home on business. However, for individuals subject to the Department of Transportation (DOT) hours of service limits, that percentage is increased to 80% for business meals consumed dur- ing, or incident to, any period of duty for which those limits are in effect. Individ- uals subject to the DOT hours of service limits include the following.

Certain air transportation workers (such as pilots, crew, dispatchers, me- chanics, and control tower operators) who are under Federal Aviation Admin- istration regulations.

Interstate truck operators who are under DOT regulations.

Certain merchant mariners who are under Coast Guard regulations.

However, you can fully deduct meals, incidentals, and entertainment furnished or reimbursed to an employee if you properly treat the expense as wages sub- ject to withholding. You can also fully

deduct meals, incidentals, and entertain- ment provided to a nonemployee to the extent the expenses are includible in the gross income of that person and reported on Form 1099-MISC. See Pub. 535 for details and other exceptions. Daycare providers. If you qualify as a family daycare provider, you can use the standard meal and snack rates, instead of actual costs, to compute the deductible cost of meals and snacks provided to eli- gible children. See Pub. 587 for details, including recordkeeping requirements.

Line 25 Deduct utility expenses only for your trade or business. Local telephone service. If you used your home phone for business, do not deduct the base rate (including taxes) of the first phone line into your residence. But you can deduct any additional costs you incurred for business that are more than the base rate of the first phone line. For example, if you had a second line, you can deduct the business percentage of the charges for that line, including the base rate charges.

Line 26 Enter the total salaries and wages for the tax year. Do not include salaries and wa- ges deducted elsewhere on your return or amounts paid to yourself. Reduce your deduction by the amounts claimed on:

Form 5884, Work Opportunity Credit;

Form 8844, Empowerment Zone Employment Credit;

Form 8845, Indian Employment Credit and

Form 8932, Credit for Employer Differential Wage Payments.

If you provided taxable fringe benefits to your employees, such as personal use of a car,

do not deduct as wages the amount ap- plicable to depreciation and other ex- penses claimed elsewhere.

In most cases, you are required to file Form W-2, Wage and Tax Statement, for each employee. See the General In- structions for Forms W-2 and W-3.

CAUTION !

Line 30 Business use of your home. You may be able to deduct certain expenses for business use of your home, subject to limitations. You must attach Form 8829 if you claim this deduction. For details, see the Instructions for Form 8829 and Pub. 587.

Line 31 If you have a loss, the amount of loss you can deduct this year may be limited. Go to line 32 before entering your loss on line 31. If you answered “No” on line G or are a qualified joint venture report- ing only rental real estate, also see the Instructions for Form 8582. Enter the net profit or deductible loss here. Com- bine this amount with any profit or loss from other businesses and enter the total on both Form 1040, line 12, and Sched- ule SE, line 2, or on Form 1040NR, line 13. Nonresident aliens using Form 1040NR should also enter the total on Schedule SE, line 2, if you are covered under the U.S. social security system due to an international social security agreement currently in effect. See the Schedule SE instructions for information on international social security agree- ments. Estates and trusts should enter the total on Form 1041, line 3. Excess farm loss rules. If your Sched- ule C activity includes processing a farm commodity as part of your farming busi- ness, your deductible loss from that ac- tivity may be limited if you received certain subsidies. See the Instructions for Schedule F for a list of those subsi- dies. Use one of the worksheets in the Schedule F instructions to determine if you have an excess farm loss. See the Instructions for Schedule F for more de- tails on how to complete the worksheets.

Statutory employees. Include your net profit or deductible loss from line 31 with other Schedule C amounts on Form 1040, line 12, or on Form 1040NR, line 13. However, do not report this amount on Schedule SE, line 2. If you were a statutory employee and are re- quired to file Schedule SE because of other self-employment income, see the Instructions for Schedule SE. Rental real estate activity. Unless you are a qualifying real estate professional, a rental real estate activity is a passive

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activity, even if you materially participa- ted in the activity. If you have a loss, you may need to file Form 8582 to fig- ure your deductible loss to enter on line 31. See the Instructions for Form 8582. Notary public. Do not enter your net profit from line 31 on Schedule SE, line 2, unless you are required to file Schedule SE because of other self-em- ployment income. See the Instructions for Schedule SE. Community income. If you and your spouse had community income and are filing separate returns, see the Instruc- tions for Schedule SE before figuring self-employment tax. Earned income credit. If you have a net profit on line 31, this amount is earned income and may qualify you for the earned income credit (EIC).

To figure your EIC, use the in- structions for Form 1040, lines 64a and 64b. Complete all ap-

plicable steps plus Worksheet B. If you are required to file Schedule SE, remem- ber to enter the deductible portion of your self-employment tax in Part 1, line 1d, of Worksheet B.

Line 32 At-risk rules. In most cases, if you have a business loss and amounts inves- ted in the business for which you are not at risk, you must complete Form 6198 to figure your allowable loss. The at-risk rules generally limit the amount of loss (including loss on the disposition of as- sets) you can claim to the amount you could actually lose in the business.

Check box 32b if you have amounts invested in this business for which you are not at risk, such as the following.

Nonrecourse loans used to finance the business, to acquire property used in the business, or to acquire the business that are not secured by your own proper- ty (other than property used in the busi- ness). However, there is an exception for certain nonrecourse financing borrowed by you in connection with holding real property.

Cash, property, or borrowed amounts used in the business (or con- tributed to the business, or used to ac- quire the business) that are protected against loss by a guarantee, stop-loss

CAUTION !

agreement, or other similar arrangement (excluding casualty insurance and insur- ance against tort liability).

Amounts borrowed for use in the business from a person who has an inter- est in the business, other than as a cred- itor, or who is related under section 465(b)(3)(C) to a person (other than you) having such an interest.

Figuring your deductible loss. If all amounts are at risk in this business, check box 32a. If you answered “Yes” on line G, enter your loss on line 31. But if you answered “No” on line G, you may need to complete Form 8582 to fig- ure your allowable loss to enter on line 31. See the Instructions for Form 8582 for details.

If you checked box 32b, first com- plete Form 6198 to determine the amount of your deductible loss. If you answered “Yes” on line G, enter that amount on line 31. But if you answered “No” on line G, your loss may be further limited. See the Instructions for Form 8582. If your at-risk amount is zero or less, enter -0- on line 31. Be sure to at- tach Form 6198 to your return. If you checked box 32b and you do not attach Form 6198, the processing of your tax return may be delayed.

Any loss from this business not al- lowed for 2012 only because of the at-risk rules is treated as a deduction al- locable to the business in 2013.

For details, see the Instructions for Form 6198 and Pub. 925.

Part III. Cost of Goods Sold In most cases, if you engaged in a trade or business in which the production, purchase, or sale of merchandise was an income-producing factor, you must take inventories into account at the beginning and end of your tax year. Exception for certain taxpayers. If you are a qualifying taxpayer or a quali- fying small business taxpayer (discussed next), you can account for inventoriable items in the same manner as materials and supplies that are not incidental. Un- der this accounting method, inventory costs for raw materials purchased for use in producing finished goods and mer- chandise purchased for resale are deduc-

tible in the year the finished goods or merchandise are sold (but not before the year you paid for the raw materials or merchandise, if you are also using the cash method). Enter amounts paid for all raw materials and merchandise during 2012 on line 36. The amount you can deduct for 2012 is figured on line 42.

Qualifying taxpayer. This is a tax- payer (a) whose average annual gross re- ceipts for the 3 prior tax years are $1 million or less, and (b) whose business is not a tax shelter (as defined in section 448(d)(3)).

Qualifying small business taxpayer. This is a taxpayer (a) whose average an- nual gross receipts for the 3 prior tax years are $10 million or less, (b) whose business is not a tax shelter (as defined in section 448(d)(3)), and (c) whose principal business activity is not an in- eligible activity as explained in Rev. Proc. 2002-28. You can find Rev. Proc. 2002-28 on page 815 of Internal Reve- nue Bulletin 2002-18 at www.irs.gov/ pub/irs-irbs/irb02-18.pdf.

Changing accounting methods. File Form 3115 if you are a qualifying tax- payer or qualifying small business tax- payer and want to change to the cash method or to account for inventoriable items as non-incidental materials and supplies.

Additional information. For addi- tional guidance on this method of ac- counting for inventoriable items, see the following.

Pub. 538 discusses both excep- tions.

If you are a qualifying taxpayer, see Rev. Proc. 2001-10, on page 272 of Internal Revenue Bulletin 2001-2 at www.irs.gov/pub/irs-irbs/irb01-02.pdf.

If you are a qualifying small busi- ness taxpayer, see Rev. Proc. 2002-28, on page 815 of Internal Revenue Bulle- tin 2002-18 at www.irs.gov/pub/irs-irbs/ irb02-18.pdf .

Certain direct and indirect ex- penses may have to be capital- ized or included in inventory.

See Part II, earlier. See Pub. 538 for ad- ditional information.

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Line 33 Your inventories can be valued at cost, the lower of cost or market, or any other method approved by the IRS. However, you are required to use cost if you are using the cash method of accounting.

Line 35 If you are changing your method of ac- counting beginning with 2012, refigure last year's closing inventory using your new method of accounting and enter the result on line 35. If there is a difference between last year's closing inventory and the refigured amount, attach an ex- planation and take it into account when figuring your section 481(a) adjustment. For details, see the example under Line F, earlier.

Line 41 If you account for inventoriable items in the same manner as materials and sup- plies that are not incidental, enter on line 41 the portion of your raw materials and merchandise purchased for resale that is included on line 40 and was not sold during the year.

Part IV. Information on Your Vehicle Line 44b In most cases, commuting is travel be- tween your home and a work location. If you converted your vehicle during the year from personal to business use (or vice versa), enter your commuting miles only for the period you drove your vehi- cle for business. For information on cer- tain travel that is considered a business expense rather than commuting, see the Instructions for Form 2106.

Part V. Other Expenses Include all ordinary and necessary busi- ness expenses not deducted elsewhere on Schedule C. List the type and amount of each expense separately in the space provided. Enter the total on lines 48 and 27a. Do not include the cost of business

equipment or furniture, replacements or permanent improvements to property, or personal, living, and family expenses. Do not include charitable contributions. Also, you cannot deduct fines or penal- ties paid to a government for violating any law. For details on business expen- ses, see Pub. 535. Amortization. Include amortization in this part. For amortization that begins in 2012, you must complete and attach Form 4562.

You can elect to amortize such costs as:

The cost of pollution-control facili- ties;

Amounts paid for research and ex- perimentation;

Qualified revitalization expendi- tures;

Amounts paid to acquire, protect, expand, register, or defend trademarks or trade names; or

Goodwill and certain other intangi- bles.

In most cases, you cannot amortize real property construction period interest and taxes. Special rules apply for allo- cating interest to real or personal proper- ty produced in your trade or business.

For a complete list, see the Instruc- tions for Form 4562, Part VI. At-risk loss deduction. Any loss from this business that was not allowed last year because of the at-risk rules is trea- ted as a deduction allocable to this busi- ness in 2012. Bad debts. Include debts and partial debts from sales or services that were in- cluded in income and are definitely known to be worthless. If you later col- lect a debt that you deducted as a bad debt, include it as income in the year collected. For details, see Pub. 535. Business start-up costs. If your busi- ness began in 2012, you can elect to de- duct up to $5,000 of certain business start-up costs. The $5,000 limit is re- duced (but not below zero) by the amount by which your total start-up costs exceed $50,000. Your remaining start-up costs can be amortized over a 180-month period, beginning with the month the business began.

For details, see chapters 7 and 8 of Pub. 535. For amortization that begins in

2012, you must complete and attach Form 4562. Costs of making commercial buildings energy efficient. You may be able to deduct part or all of the cost of modify- ing existing commercial buildings to make them energy efficient. For details, see section 179D, Notice 2006-52, No- tice 2008-40, and Notice 2012-26. No- tice 2006-52, 2006-26 I.R.B. 1175, is available at www.irs.gov/irb/2006-26_IRB/ ar11.html. Notice 2008-40, 2008-14 I.R.B. 725, is available at www.irs.gov/irb/2008-14_IRB/ ar12.html. Notice 2012-26, 2012-17 I.R.B. 847, is available at www.irs.gov/ irb/2012-17_IRB/ar08.html. Deduction for removing barriers to individuals with disabilities and the elderly. You may be able to deduct up to $15,000 of costs paid or incurred in 2012 to remove architectural or trans- portation barriers to individuals with disabilities and the elderly. However, you cannot take both a credit (on Form 8826) and a deduction for the same ex- penditures. Excess farm loss deduction. Any loss from this business activity, which in- cludes processing a farm commodity as part of your farming business, that was not allowed last year because of the ex- cess farm loss rules is treated as a de- duction allocable to this business activi- ty in 2012.

See the Instructions for Schedule F for a definition of farming business for this purpose and for more information about excess farm losses. Forestation and reforestation costs. Reforestation costs are generally capital expenditures. However, for each quali- fied timber property, you can elect to ex- pense up to $10,000 ($5,000 if married filing separately) of qualifying reforesta- tion costs paid or incurred in 2012.

You can elect to amortize the remain- ing costs over 84 months. For amortiza- tion that begins in 2012, you must com- plete and attach Form 4562.

The amortization election does not apply to trusts, and the expense election does not apply to estates and trusts. For details on reforestation expenses, see chapters 7 and 8 of Pub. 535.

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Principal Business or Professional Activity Codes These codes for the Principal Business or Professional Activity classify sole proprietorships by the type of activity they are engaged in to facilitate the administration of the Internal Revenue Code. These

six-digit codes are based on the North American Industry Classification System (NAICS).

Select the category that best describes your primary business activity (for example, Real Estate). Then select the activity that best identifies the principal source of your sales or receipts (for example, real

estate agent). Now find the six-digit code assigned to this activity (for example, 531210, the code for offices of real estate agents and brokers) and enter it on Schedule C or C-EZ, line B.

Note. If your principal source of income is from farming activities, you should file Schedule F.

Accommodation, Food Services, & Drinking Places Accommodation 721310 Rooming & boarding houses 721210 RV (recreational vehicle) parks

& recreational camps 721100 Traveler accommodation

(including hotels, motels, & bed & breakfast inns)

Food Services & Drinking Places 722514 Cafeterias & buffets 722410 Drinking places (alcoholic

beverages) 722511 Full-service restaurants 722513 Limited-service restaurants 722515 Snack & non-alcoholic beverage

bars 722300 Special food services (including

food service contractors & caterers)

Administrative & Support and Waste Management & Remediation Services Administrative & Support Services 561430 Business service centers

(including private mail centers & copy shops)

561740 Carpet & upholstery cleaning services

561440 Collection agencies 561450 Credit bureaus 561410 Document preparation services 561300 Employment services 561710 Exterminating & pest control

services 561210 Facilities support (management)

services 561600 Investigation & security services 561720 Janitorial services 561730 Landscaping services 561110 Office administrative services 561420 Telephone call centers

(including telephone answering services & telemarketing bureaus)

561500 Travel arrangement & reservation services

561490 Other business support services (including repossession services, court reporting, & stenotype services)

561790 Other services to buildings & dwellings

561900 Other support services (including packaging & labeling services, & convention & trade show organizers)

Waste Management & Remediation Services 562000 Waste management &

remediation services Agriculture, Forestry, Hunting, & Fishing 112900 Animal production (including

breeding of cats and dogs) 114110 Fishing 113000 Forestry & logging (including

forest nurseries & timber tracts) 114210 Hunting & trapping Support Activities for Agriculture & Forestry 115210 Support activities for animal

production (including farriers) 115110 Support activities for crop

production (including cotton

ginning, soil preparation, planting, & cultivating)

115310 Support activities for forestry Arts, Entertainment, & Recreation Amusement, Gambling, & Recreation Industries 713100 Amusement parks & arcades 713200 Gambling industries 713900 Other amusement & recreation

services (including golf courses, skiing facilities, marinas, fitness centers, bowling centers, skating rinks, miniature golf courses)

Museums, Historical Sites, & Similar Institutions 712100 Museums, historical sites, &

similar institutions Performing Arts, Spectator Sports, & Related Industries 711410 Agents & managers for artists,

athletes, entertainers, & other public figures

711510 Independent artists, writers, & performers

711100 Performing arts companies 711300 Promoters of performing arts,

sports, & similar events 711210 Spectator sports (including

professional sports clubs & racetrack operations)

Construction of Buildings 236200 Nonresidential building

construction 236100 Residential building

construction Heavy and Civil Engineering Construction 237310 Highway, street, & bridge

construction 237210 Land subdivision 237100 Utility system construction 237990 Other heavy & civil engineering

construction Specialty Trade Contractors 238310 Drywall & insulation

contractors 238210 Electrical contractors 238350 Finish carpentry contractors 238330 Flooring contractors 238130 Framing carpentry contractors 238150 Glass & glazing contractors 238140 Masonry contractors 238320 Painting & wall covering

contractors 238220 Plumbing, heating & air-

conditioning contractors 238110 Poured concrete foundation &

structure contractors 238160 Roofing contractors 238170 Siding contractors 238910 Site preparation contractors 238120 Structural steel & precast

concrete construction contractors

238340 Tile & terrazzo contractors 238290 Other building equipment

contractors 238390 Other building finishing

contractors 238190 Other foundation, structure, &

building exterior contractors 238990 All other specialty trade

contractors

Educational Services 611000 Educational services (including

schools, colleges, & universities)

Finance & Insurance Credit Intermediation & Related Activities 522100 Depository credit intermediation

(including commercial banking, savings institutions, & credit unions)

522200 Nondepository credit intermediation (including sales financing & consumer lending)

522300 Activities related to credit intermediation (including loan brokers)

Insurance Agents, Brokers, & Related Activities 524210 Insurance agencies &

brokerages 524290 Other insurance related

activities Securities, Commodity Contracts, & Other Financial Investments & Related Activities 523140 Commodity contracts brokers 523130 Commodity contracts dealers 523110 Investment bankers & securities

dealers 523210 Securities & commodity

exchanges 523120 Securities brokers 523900 Other financial investment

activities (including investment advice)

Health Care & Social Assistance Ambulatory Health Care Services 621610 Home health care services 621510 Medical & diagnostic

laboratories 621310 Offices of chiropractors 621210 Offices of dentists 621330 Offices of mental health

practitioners (except physicians) 621320 Offices of optometrists 621340 Offices of physical,

occupational & speech therapists, & audiologists

621111 Offices of physicians (except mental health specialists)

621112 Offices of physicians, mental health specialists

621391 Offices of podiatrists 621399 Offices of all other

miscellaneous health practitioners

621400 Outpatient care centers 621900 Other ambulatory health care

services (including ambulance services, blood, & organ banks)

Hospitals 622000 Hospitals Nursing & Residential Care Facilities 623000 Nursing & residential care

facilities Social Assistance 624410 Child day care services 624200 Community food & housing, &

emergency & other relief services

624100 Individual & family services 624310 Vocational rehabilitation

services Information 511000 Publishing industries (except

Internet)

Broadcasting (except Internet) & Telecommunications 515000 Broadcasting (except Internet) 517000 Telecommunications & Internet

service providers Data Processing Services 518210 Data processing, hosting, &

related services 519100 Other information services

(including news syndicates & libraries, Internet publishing & broadcasting)

Motion Picture & Sound Recording 512100 Motion picture & video

industries (except video rental) 512200 Sound recording industries Manufacturing 315000 Apparel mfg. 312000 Beverage & tobacco product

mfg. 334000 Computer & electronic product

mfg. 335000 Electrical equipment, appliance,

& component mfg. 332000 Fabricated metal product mfg. 337000 Furniture & related product mfg. 333000 Machinery mfg. 339110 Medical equipment & supplies

mfg. 322000 Paper mfg. 324100 Petroleum & coal products mfg. 326000 Plastics & rubber products mfg. 331000 Primary metal mfg. 323100 Printing & related support

activities 313000 Textile mills 314000 Textile product mills 336000 Transportation equipment mfg. 321000 Wood product mfg. 339900 Other miscellaneous mfg. Chemical Manufacturing 325100 Basic chemical mfg. 325500 Paint, coating, & adhesive mfg. 325300 Pesticide, fertilizer, & other

agricultural chemical mfg. 325410 Pharmaceutical & medicine

mfg. 325200 Resin, synthetic rubber, &

artificial & synthetic fibers & filaments mfg.

325600 Soap, cleaning compound, & toilet preparation mfg.

325900 Other chemical product & preparation mfg.

Food Manufacturing 311110 Animal food mfg. 311800 Bakeries, tortilla, & dry pasta

mfg. 311500 Dairy product mfg. 311400 Fruit & vegetable preserving &

speciality food mfg. 311200 Grain & oilseed milling 311610 Animal slaughtering &

processing 311710 Seafood product preparation &

packaging 311300 Sugar & confectionery product

mfg. 311900 Other food mfg. (including

coffee, tea, flavorings, & seasonings)

Leather & Allied Product Manufacturing 316210 Footwear mfg. (including

leather, rubber, & plastics)

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Principal Business or Professional Activity Codes (Continued) 316110 Leather & hide tanning &

finishing 316990 Other leather & allied product

mfg. Nonmetallic Mineral Product Manufacturing 327300 Cement & concrete product

mfg. 327100 Clay product & refractory mfg. 327210 Glass & glass product mfg. 327400 Lime & gypsum product mfg. 327900 Other nonmetallic mineral

product mfg. Mining 212110 Coal mining 212200 Metal ore mining 212300 Nonmetallic mineral mining &

quarrying 211110 Oil & gas extraction 213110 Support activities for mining Other Services Personal & Laundry Services 812111 Barber shops 812112 Beauty salons 812220 Cemeteries & crematories 812310 Coin-operated laundries &

drycleaners 812320 Drycleaning & laundry services

(except coin-operated) (including laundry & drycleaning dropoff & pickup sites)

812210 Funeral homes & funeral services

812330 Linen & uniform supply 812113 Nail salons 812930 Parking lots & garages 812910 Pet care (except veterinary)

services 812920 Photofinishing 812190 Other personal care services

(including diet & weight reducing centers)

812990 All other personal services Repair & Maintenance 811120 Automotive body, paint,

interior, & glass repair 811110 Automotive mechanical &

electrical repair & maintenance 811190 Other automotive repair &

maintenance (including oil change & lubrication shops & car washes)

811310 Commercial & industrial machinery & equipment (except automotive & electronic) repair & maintenance

811210 Electronic & precision equipment repair & maintenance

811430 Footwear & leather goods repair 811410 Home & garden equipment &

appliance repair & maintenance 811420 Reupholstery & furniture repair 811490 Other personal & household

goods repair & maintenance Professional, Scientific, & Technical Services 541100 Legal services 541211 Offices of certified public

accountants 541214 Payroll services 541213 Tax preparation services 541219 Other accounting services Architectural, Engineering, & Related Services 541310 Architectural services 541350 Building inspection services 541340 Drafting services 541330 Engineering services 541360 Geophysical surveying &

mapping services

541320 Landscape architecture services 541370 Surveying & mapping (except

geophysical) services 541380 Testing laboratories Computer Systems Design & Related Services 541510 Computer systems design &

related services Specialized Design Services 541400 Specialized design services

(including interior, industrial, graphic, & fashion design)

Other Professional, Scientific, & Technical Services 541800 Advertising & related services 541600 Management, scientific, &

technical consulting services 541910 Market research & public

opinion polling 541920 Photographic services 541700 Scientific research &

development services 541930 Translation & interpretation

services 541940 Veterinary services 541990 All other professional, scientific,

& technical services Real Estate & Rental & Leasing Real Estate 531100 Lessors of real estate (including

miniwarehouses & self-storage units)

531210 Offices of real estate agents & brokers

531320 Offices of real estate appraisers 531310 Real estate property managers 531390 Other activities related to real

estate Rental & Leasing Services 532100 Automotive equipment rental &

leasing 532400 Commercial & industrial

machinery & equipment rental & leasing

532210 Consumer electronics & appliances rental

532220 Formal wear & costume rental 532310 General rental centers 532230 Video tape & disc rental 532290 Other consumer goods rental Religious, Grantmaking, Civic, Professional, & Similar Organizations 813000 Religious, grantmaking, civic,

professional, & similar organizations

Retail Trade Building Material & Garden Equipment & Supplies Dealers 444130 Hardware stores 444110 Home centers 444200 Lawn & garden equipment &

supplies stores 444120 Paint & wallpaper stores 444190 Other building materials dealers Clothing & Accessories Stores 448130 Children's & infants' clothing

stores 448150 Clothing accessories stores 448140 Family clothing stores 448310 Jewelry stores 448320 Luggage & leather goods stores 448110 Men's clothing stores 448210 Shoe stores 448120 Women's clothing stores 448190 Other clothing stores Electronic & Appliance Stores 443142 Electronics stores (including

audio, video, computer, & camera stores)

443141 Household appliance stores Food & Beverage Stores 445310 Beer, wine, & liquor stores 445220 Fish & seafood markets 445230 Fruit & vegetable markets 445100 Grocery stores (including

supermarkets & convenience stores without gas)

445210 Meat markets 445290 Other specialty food stores Furniture & Home Furnishing Stores 442110 Furniture stores 442200 Home furnishings stores Gasoline Stations 447100 Gasoline stations (including

convenience stores with gas) General Merchandise Stores 452000 General merchandise stores Health & Personal Care Stores 446120 Cosmetics, beauty supplies, &

perfume stores 446130 Optical goods stores 446110 Pharmacies & drug stores 446190 Other health & personal care

stores Motor Vehicle & Parts Dealers 441300 Automotive parts, accessories,

& tire stores 441222 Boat dealers 441228 Motorcycle, ATV, & all other

motor vehicle dealers 441110 New car dealers 441210 Recreational vehicle dealers

(including motor home & travel trailer dealers)

441120 Used car dealers Sporting Goods, Hobby, Book, & Music Stores 451211 Book stores 451120 Hobby, toy, & game stores 451140 Musical instrument & supplies

stores 451212 News dealers & newsstands 451130 Sewing, needlework, & piece

goods stores 451110 Sporting goods stores Miscellaneous Store Retailers 453920 Art dealers 453110 Florists 453220 Gift, novelty, & souvenir stores 453930 Manufactured (mobile) home

dealers 453210 Office supplies & stationery

stores 453910 Pet & pet supplies stores 453310 Used merchandise stores 453990 All other miscellaneous store

retailers (including tobacco, candle, & trophy shops)

Nonstore Retailers 454112 Electronic auctions 454111 Electronic shopping 454310 Fuel dealers (including heating

oil & liquefied petroleum) 454113 Mail-order houses 454210 Vending machine operators 454390 Other direct selling

establishments (including door-to-door retailing, frozen food plan providers, party plan merchandisers, & coffee-break service providers)

Transportation & Warehousing 481000 Air transportation 485510 Charter bus industry 484110 General freight trucking, local 484120 General freight trucking, long

distance 485210 Interurban & rural bus

transportation

486000 Pipeline transportation 482110 Rail transportation 487000 Scenic & sightseeing

transportation 485410 School & employee bus

transportation 484200 Specialized freight trucking

(including household moving vans)

485300 Taxi & limousine service 485110 Urban transit systems 483000 Water transportation 485990 Other transit & ground

passenger transportation 488000 Support activities for

transportation (including motor vehicle towing)

Couriers & Messengers 492000 Couriers & messengers Warehousing & Storage Facilities 493100 Warehousing & storage (except

leases of miniwarehouses & self-storage units)

Utilities 221000 Utilities Wholesale Trade Merchant Wholesalers, Durable Goods 423200 Furniture & home furnishing 423700 Hardware, & plumbing &

heating equipment & supplies 423600 Household appliances &

electrical & electronic goods 423940 Jewelry, watch, precious stone,

& precious metals 423300 Lumber & other construction

materials 423800 Machinery, equipment, &

supplies 423500 Metal & mineral (except

petroleum) 423100 Motor vehicle & motor vehicle

parts & supplies 423400 Professional & commercial

equipment & supplies 423930 Recyclable materials 423910 Sporting & recreational goods &

supplies 423920 Toy & hobby goods & supplies 423990 Other miscellaneous durable

goods Merchant Wholesalers, Nondurable Goods 424300 Apparel, piece goods, & notions 424800 Beer, wine, & distilled alcoholic

beverage 424920 Books, periodicals, &

newspapers 424600 Chemical & allied products 424210 Drugs & druggists' sundries 424500 Farm product raw materials 424910 Farm supplies 424930 Flower, nursery stock, &

florists' supplies 424400 Grocery & related products 424950 Paint, varnish, & supplies 424100 Paper & paper products 424700 Petroleum & petroleum products 424940 Tobacco & tobacco products 424990 Other miscellaneous nondurable

goods Wholesale Electronic Markets and Agents & Brokers 425110 Business to business electronic

markets 425120 Wholesale trade agents &

brokers 999999 Unclassified establishments

(unable to classify)

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Department of the Treasury Internal Revenue Service

2012 Instructions for Schedule D Capital Gains and Losses

These instructions explain how to complete Schedule D (Form 1040). Complete Form 8949 before you complete line 1, 2, 3, 8, 9, or 10 of Schedule D.

Use Schedule D: To figure the overall gain or loss from transactions reported on Form 8949, To report a gain from Form 2439 or 6252 or Part I of Form 4797, To report a gain or loss from Form 4684, 6781, or 8824, To report a gain or loss from a partnership, S corporation, estate or trust, To report capital gain distributions not reported directly on Form 1040, line 13

(or effectively connected capital gain distributions not reported directly on Form 1040NR, line 14), and

To report a capital loss carryover from 2011 to 2012. Additional information. See Pub. 544 and Pub. 550 for more details.

Section references are to the Internal Revenue Code unless otherwise noted.

Future Developments For the latest information about devel- opments related to Schedule D and its instructions, such as legislation enacted after they were published, go to www.irs.gov/form1040.

What's New Form 8949. For 2012, Form 8949 has separate instructions. The Form 8949 in- structions are no longer included in the Schedule D instructions.

General Instructions Other Forms You May Have To File Use Form 8949 to report the sale or ex- change of a capital asset (defined later) not reported on another form or sched- ule. Complete all necessary pages of Form 8949 before you complete line 1, 2, 3, 8, 9, or 10 of Schedule D.

Use Form 4797 to report the follow- ing.

1. The sale or exchange of: a. Property used in a trade or busi-

ness; b. Depreciable and amortizable

property; c. Oil, gas, geothermal, or other

mineral property; and

d. Section 126 property. 2. The involuntary conversion (other

than from casualty or theft) of property used in a trade or business and capital assets held for business or profit.

3. The disposition of noncapital as- sets other than inventory or property held primarily for sale to customers in the ordinary course of your trade or business.

4. Ordinary loss on the sale, ex- change, or worthlessness of small busi- ness investment company (section 1242) stock.

5. Ordinary loss on the sale, ex- change, or worthlessness of small busi- ness (section 1244) stock.

6. Ordinary gain or loss on securi- ties held in connection with your trading business, if you previously made a mark-to-market election. See Traders in Securities, later.

Use Form 4684 to report involuntary conversions of property due to casualty or theft.

Use Form 6781 to report gains and losses from section 1256 contracts and straddles.

Use Form 8824 to report like-kind exchanges. A like-kind exchange occurs when you exchange business or invest- ment property for property of a like kind.

Capital Asset Most property you own and use for per- sonal purposes, pleasure, or investment

is a capital asset. For example, your house, furniture, car, stocks, and bonds are capital assets. A capital asset is any property held by you except the follow- ing.

Stock in trade or other property in- cluded in inventory or held mainly for sale to customers. But see the Tip about certain musical compositions or copy- rights, later.

Accounts or notes receivable for services performed in the ordinary course of your trade or business or as an employee, or from the sale of stock in trade or other property held mainly for sale to customers.

Depreciable property used in your trade or business, even if it is fully de- preciated.

Real estate used in your trade or business.

Copyrights, literary, musical, or ar- tistic compositions, letters or memoran- da, or similar property (a) created by your personal efforts; (b) prepared or produced for you (in the case of letters, memoranda, or similar property); or (c) that you received from someone who created them or for whom they were cre- ated, as mentioned in (a) or (b), in a way (such as by gift) that entitled you to the basis of the previous owner. But see the Tip about certain musical compositions or copyrights, later.

U.S. Government publications, in- cluding the Congressional Record, that you received from the Government, oth- er than by purchase at the normal sales price, or that you got from someone who had received it in a similar way, if your

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basis is determined by reference to the previous owner's basis.

Certain commodities derivative fi- nancial instruments held by a dealer and not connected to the dealer's activities as a dealer. See section 1221(a)(6).

Certain hedging transactions en- tered into in the normal course of your trade or business. See section 1221(a) (7).

Supplies regularly used in your trade or business.

You can elect to treat as capi­ tal assets certain musical com­ positions or copyrights you

sold or exchanged. See Pub. 550 for de­ tails.

Basis and Recordkeeping Basis is the amount of your investment in property for tax purposes. The basis of property you buy is usually its cost. You need to know your basis to figure any gain or loss on the sale or other dis- position of the property. You must keep accurate records that show the basis and, if applicable, adjusted basis of your property. Your records should show the purchase price, including commissions; increases to basis, such as the cost of improvements; and decreases to basis, such as depreciation, nondividend distri- butions on stock, and stock splits.

For more information on basis, see the instructions for column (e), the in- structions for Form 8949, and these pub- lications.

Pub. 551, Basis of Assets. Pub. 550, Investment Income and

Expenses (Including Capital Gains and Losses).

Short Term or Long Term Report short-term gains or losses in Part I. Report long-term gains or losses in Part II. The holding period for short-term capital gains and losses is 1 year or less. The holding period for long-term capital gains and losses is more than 1 year.

For more information about holding periods, see the instructions for Form 8949.

Capital Gain Distributions These distributions are paid by a mutual fund (or other regulated investment company) or real estate investment trust

TIP

from its net realized long-term capital gains. Distributions of net realized short-term capital gains are not treated as capital gains. Instead, they are inclu- ded on Form 1099-DIV as ordinary divi- dends.

Enter on Schedule D, line 13, the to- tal capital gain distributions paid to you during the year, regardless of how long you held your investment. This amount is shown in box 2a of Form 1099-DIV.

If there is an amount in box 2b, in- clude that amount on line 11 of the Un- recaptured Section 1250 Gain Work- sheet in these instructions if you com- plete line 19 of Schedule D.

If there is an amount in box 2c, see Exclusion of Gain on Qualified Small Business (QSB) Stock, later.

If there is an amount in box 2d, in- clude that amount on line 4 of the 28% Rate Gain Worksheet in these instruc- tions if you complete line 18 of Sched- ule D.

If you received capital gain distribu- tions as a nominee (that is, they were paid to you but actually belong to some- one else), report on Schedule D, line 13, only the amount that belongs to you. At- tach a statement showing the full amount you received and the amount you received as a nominee. See the In- structions for Schedule B to learn about the requirement for you to file Forms 1099-DIV and 1096.

Sale of Your Home Report the sale or exchange of your main home on Form 8949 if:

You cannot exclude all of your gain from income, or

You received a Form 1099-S for the sale or exchange. Any gain you cannot exclude is taxable. Generally, if you meet the two following tests, you can exclude up to $250,000 of gain. If both you and your spouse meet these tests and you file a joint return, you can exclude up to $500,000 of gain (but only one spouse needs to meet the ownership requirement in Test 1). Test 1. During the 5-year period end- ing on the date you sold or exchanged your home, you owned it for 2 years or more (the ownership requirement) and lived in it as your main home for 2 years or more (the use requirement).

Test 2. You have not excluded gain on the sale or exchange of another main home during the 2-year period ending on the date of the sale or exchange of your home.

Even if you do not meet one or both of the above two tests, you still can claim an exclusion if you sold or ex- changed the home because of a change in place of employment, health, or cer- tain unforeseen circumstances. In this case, the maximum amount of gain you can exclude is reduced.

If your spouse died before the sale or exchange, you can exclude up to $500,000 of gain if:

The sale or exchange is no later than 2 years after your spouse's death,

Just before your spouse's death, both spouses met the use requirement of Test 1, at least one spouse met the own- ership requirement of Test 1, and both spouses met Test 2, and

You did not remarry before the sale or exchange.

You can choose to have the 5-year test period for ownership and use in Test 1 suspended during any period you or your spouse serve outside the United States as a Peace Corps volunteer or serve on qualified official extended duty as a member of the uniformed services or Foreign Service of the United States, as an employee of the intelligence com- munity, or outside the United States as an employee of the Peace Corps. This means you may be able to meet Test 1 even if, because of your service, you did not actually use the home as your main home for at least the required 2 years during the 5-year period ending on the date of sale.

You cannot exclude any gain if: You acquired your home in a

like-kind exchange in which all or part of the gain was not recognized, and

You sold or exchanged the home during the 5-year period beginning on the date you acquired it.

If you have to report the sale or ex- change, report it on Form 8949. If the gain or loss is short-term, report it in Part I of Form 8949. If the gain or loss is long-term, report it in Part II of Form 8949. Check box C at the top of this Form 8949.

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If you had a gain and can exclude part or all of it, enter “H” in column (f). Enter the exclusion as a negative num- ber (in parentheses) in column (g). See the instructions for Form 8949, columns (f), (g), and (h). Complete all columns.

If you had a loss but have to report the sale or exchange because you got a Form 1099-S, see Nondeductible Losses, later, for instructions about how to re- port it.

See Pub. 523 for additional details, including how to figure and report any taxable gain if:

You (or your spouse if married) used any part of the home for business or rental purposes after May 6, 1997, or

There was a period of time after 2008 when the home was not your main home.

Partnership Interests A sale or other disposition of an interest in a partnership may result in ordinary income, collectibles gain (28% rate gain), or unrecaptured section 1250 gain. For details on 28% rate gain, see the instructions for line 18 of Sched- ule D. For details on unrecaptured sec- tion 1250 gain, see the instructions for line 19 of Schedule D.

Capital Assets Held for Personal Use Generally, gain from the sale or ex- change of a capital asset held for person- al use is a capital gain. Report it on Form 8949, Part I or Part II, with box C checked. However, if you converted de- preciable property to personal use, all or part of the gain on the sale or exchange of that property may have to be recap- tured as ordinary income. Use Part III of Form 4797 to figure the amount of ordi- nary income recapture. The recapture amount is included on line 31 (and line 13) of Form 4797. Do not enter any gain from this property on line 32 of Form 4797. If you are not completing Part III for any other properties, enter “N/A” on line 32. If the total gain is more than the recapture amount, enter “From Form 4797” in column (a) of Part I of Form 8949 (if the transaction is short term) or Part II of Form 8949 (if the transaction is long term), and skip columns (b) and (c). In column (d), enter the excess of the total gain over the re- capture amount. Leave columns (e)

through (g) blank. Complete column (h). Be sure to check box C at the top of Part I or Part II of this Form 8949 (depending on how long you held the asset).

Loss from the sale or exchange of a capital asset held for personal use is not deductible. But if you had a loss from the sale or exchange of real estate held for personal use for which you received a Form 1099-S, you must report the transaction on Form 8949 even though the loss is not deductible. For example, you have a loss on the sale of a vacation home that is not your main home and you received a Form 1099-S for the transaction. Report the transaction in Part I or Part II of Form 8949, depend- ing on how long you owned the home. Complete all columns. Because the loss is not deductible, enter “L” in column (f). Enter the difference between column (d) and column (e) as a positive amount in column (g). Then complete column (h). For example, if you entered $5,000 in column (d) and $6,000 in column (e), enter $1,000 in column (g). Then en- ter -0- ($5,000 – $6,000 + $1,000) in column (h). Be sure to check box C at the top of Part I or Part II of this Form 8949 (depending on how long you owned the home).

Capital Losses You can deduct capital losses up to the amount of your capital gains plus $3,000 ($1,500 if married filing separately). You may be able to use capital losses that exceed this limit in future years. For details, see the instructions for line 21. Be sure to report all of your capital gains and losses even if you cannot use all of your losses in 2012.

Nondeductible Losses Do not deduct a loss from the direct or indirect sale or exchange of property be- tween any of the following.

Members of a family. A corporation and an individual

owning more than 50% of the corpora- tion's stock (unless the loss is from a distribution in complete liquidation of a corporation).

A grantor and a fiduciary of a trust. A fiduciary and a beneficiary of the

same trust. A fiduciary and a beneficiary of

another trust created by the same gran- tor.

An executor of an estate and a ben- eficiary of that estate, unless the sale or exchange was to satisfy a pecuniary be- quest (that is, a bequest of a sum of money).

An individual and a tax-exempt or- ganization controlled by the individual or the individual's family.

See Pub. 544 for more details on sales and exchanges between related parties.

Report a transaction that results in a nondeductible loss in Part I or Part II of Form 8949, depending on how long you held the property. Unless you received a Form 1099-B for the sale or exchange, check box C at the top of Part I or Part II of this Form 8949 (depending on how long you owned the property). Complete all columns. Because the loss is not de- ductible, enter “L” in column (f). Enter the amount of the nondeductible loss as a positive number in column (g). Com- plete column (h). See the instructions for Form 8949, columns (f), (g), and (h).

Example 1. You sold land you held as an investment for 5 years to your brother for $10,000. Your basis was $15,000. On Part II of Form 8949, check box C at the top. Enter $10,000 on Form 8949, Part II, column (d). Enter $15,000 in column (e). Because the loss is not deductible, enter “L” in column (f) and $5,000 (the difference between $10,000 and $15,000) in column (g). In column (h), enter -0- ($10,000 − $15,000 + $5,000). If this is your only transaction on this Form 8949, enter $10,000 on Schedule D, line 10, column (d). Enter $15,000 in column (e) and $5,000 in column (g). In column (h), enter -0- ($10,000 − $15,000 + $5,000).

Example 2. You received a Form 1099-B showing proceeds (sales price) of $1,000 and a basis of $5,000. Box 2b on Form 1099-B is checked, so your loss of $4,000 ($1,000 - $5,000) is not al- lowed. On the top of Form 8949, check box A or box B in Part I or Part II (whichever applies). Enter $1,000 in column (d) and $5,000 in column (e). Because the loss is not deductible, enter “L” in column (f) and $4,000 (the differ- ence between $1,000 and $5,000) in col- umn (g). In column (h), enter -0- ($1,000 - $5,000 + $4,000). At-risk rules. If you disposed of (a) an asset used in an activity to which the

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at-risk rules apply or (b) any part of your interest in an activity to which the at-risk rules apply, and you have amounts in the activity for which you are not at risk, see the Instructions for Form 6198. Passive activity rules. If the loss is al- lowable under the at-risk rules, it then may be subject to the passive activity rules. See Form 8582 and its instructions for details on reporting capital gains and losses from a passive activity.

Items for Special Treatment Transactions by a securities dealer.

See section 475 and Rev. Rul. 97-39, which begins on page 4 of Internal Rev- enue Bulletin 1997-39 at www.irs.gov/ pub/irs­irbs/irb97­39.pdf..

Bonds and other debt instruments. See Pub. 550.

Charitable gift annuity. See the in- structions for Form 8949.

Certain real estate subdivided for sale that may be considered a capital as- set. See section 1237.

Gain on the sale of depreciable property to a more than 50% owned en- tity or to a trust of which you are a bene- ficiary. See Pub. 544.

Gain on the disposition of stock in an interest charge domestic international sales corporation. See section 995(c).

Gain on the sale or exchange of stock in certain foreign corporations. See section 1248.

Transfer of property to a partner- ship that would be treated as an invest- ment company if it were incorporated. See Pub. 541.

Sales of stock received under a qualified public utility dividend rein- vestment plan. See Pub. 550.

Transfer of appreciated property to a political organization. See section 84.

Transfer of property by a U.S. per- son to a foreign estate or trust. See sec- tion 684.

If you give up your U.S. citizen- ship, you may be treated as having sold all your property for its fair market val- ue on the day before you gave up your citizenship. This also applies to long-term U.S. residents who cease to be lawful permanent residents. For details, exceptions, and rules for reporting these deemed sales, see Pub. 519 and Form 8854.

In general, no gain or loss is recog- nized on the transfer of property from an individual to a spouse or a former spouse if the transfer is incident to a di- vorce. See Pub. 504.

Amounts received on the retire- ment of a debt instrument generally are treated as received in exchange for the debt instrument. See Pub. 550.

Any loss on the disposition of con- verted wetland or highly erodible crop- land that is first used for farming after March 1, 1986, is reported as a long-term capital loss on Form 8949, but any gain is reported as ordinary income on Form 4797.

If qualified dividends that you re- ported on Form 1040, line 9b, or Form 1040NR, line 10b, include extraordinary dividends, any loss on the sale or ex- change of the stock is a long-term capi- tal loss to the extent of the extraordinary dividends. An extraordinary dividend is a dividend that equals or exceeds 10% (5% in the case of preferred stock) of your basis in the stock.

Amounts received by shareholders in corporate liquidations. See Pub. 550.

Cash received in lieu of fractional shares of stock as a result of a stock split or stock dividend. See Pub. 550.

Load charges to acquire stock in a regulated investment company (includ- ing a mutual fund), which may not be taken into account in determining gain or loss on certain dispositions of the stock if reinvestment rights were exer- cised. See Pub. 550.

The sale or exchange of S corpora- tion stock or an interest in a trust held for more than 1 year, which may result in collectibles gain (28% rate gain). See the instructions for line 18.

Gain or loss on the disposition of securities futures contracts. See Pub. 550.

Gain on the constructive sale of certain appreciated financial positions. See Pub. 550.

Certain constructive ownership transactions. Gain in excess of the gain you would have recognized if you had held a financial asset directly during the term of a derivative contract must be treated as ordinary income. See section 1260. If any portion of the constructive ownership transaction was open in any prior year, you may have to pay interest. See section 1260(b) for details, includ- ing how to figure the interest. Include

the interest as an additional tax on Form 1040, line 60 (or Form 1040NR, line 59). Write “Section 1260(b) inter- est” and the amount of the interest to the left of line 60 (or Form 1040NR, line 59). This interest is not deductible.

Gain or loss from the disposition of stock or other securities in an investment club. See Pub. 550.

Wash Sales A wash sale occurs when you sell or otherwise dispose of stock or securities (including a contract or option to acquire or sell stock or securities) at a loss and, within 30 days before or after the sale or disposition, you:

1. Buy substantially identical stock or securities,

2. Acquire substantially identical stock or securities in a fully taxable trade,

3. Enter into a contract or option to acquire substantially identical stock or securities, or

4. Acquire substantially identical stock or securities for your individual re- tirement arrangement (IRA) or Roth IRA.

You cannot deduct losses from wash sales unless the loss was incurred in the ordinary course of your business as a dealer in stock or securities. The basis of the substantially identical property (or contract or option to acquire such prop- erty) is its cost increased by the disal- lowed loss (except in the case of (4) above).

If you received a Form 1099-B (or substitute statement), box 5 of that form will show any nondeductible wash sale loss if:

The stock or securities sold were covered securities (defined in the in- structions for Form 8949, column (f)), and

The substantially identical stock or securities you bought had the same CU- SIP number as the stock or securities you sold and were bought in the same account as the stock or securities you sold. However, you cannot deduct a loss from a wash sale even if it is not reported on Form 1099-B (or substitute statement). For more details on wash sales, see Pub. 550.

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Report a wash sale transaction in Part I or Part II (depending on how long you owned the stock or securities) of Form 8949 with the appropriate box (A, B, or C) checked. Complete all columns. En- ter "W" in column (f). Enter as a posi- tive number in column (g) the amount of the loss not allowed. See the instructions for Form 8949, columns (f), (g), and (h).

Traders in Securities You are a trader in securities if you are engaged in the business of buying and selling securities for your own account. To be engaged in business as a trader in securities, all of the following state- ments must be true.

You must seek to profit from daily market movements in the prices of se- curities and not from dividends, interest, or capital appreciation.

Your activity must be substantial. You must carry on the activity with

continuity and regularity. The following facts and circumstan-

ces should be considered in determining if your activity is a business.

Typical holding periods for securi- ties bought and sold.

The frequency and dollar amount of your trades during the year.

The extent to which you pursue the activity to produce income for a liveli- hood.

The amount of time you devote to the activity.

You are considered an investor, and not a trader, if your activity does not meet the above definition of a business. It does not matter whether you call your- self a trader or a “day trader.”

Like an investor, a trader must report each sale of securities (taking into ac- count commissions and any other costs of acquiring or disposing of the securi- ties) on Form 8949 or on an attached statement containing all the same infor- mation for each sale in a similar format. However, if a trader previously made the mark-to-market election (explained next), each transaction is reported in Part II of Form 4797 instead of on Form 8949. Regardless of whether a trader re- ports his or her gains and losses on Form 8949 or Form 4797, the gain or loss from the disposition of securities is not taken into account when figuring net earnings from self-employment on Schedule SE. See the Instructions for

Schedule SE for an exception that ap- plies to section 1256 contracts.

The limitation on investment interest expense that applies to investors does not apply to interest paid or incurred in a trading business. A trader reports inter- est expense and other expenses (exclud- ing commissions and other costs of ac- quiring or disposing of securities) from a trading business on Schedule C (instead of Schedule A).

A trader also may hold securities for investment. The rules for investors gen- erally will apply to those securities. Al- locate interest and other expenses be- tween your trading business and your in- vestment securities.

Mark-To-Market Election for Traders A trader may make an election under section 475(f) to report all gains and los- ses from securities held in connection with a trading business as ordinary in- come (or loss), including those from se- curities held at the end of the year. Se- curities held at the end of the year are “marked-to-market” by treating them as if they were sold (and reacquired) for fair market value on the last business day of the year. Generally, the election must be made by the due date (not in- cluding extensions) of the tax return for the year prior to the year for which the election becomes effective. To be effec- tive for 2012, the election must have been made by April 17, 2012.

Starting with the year the election be- comes effective, a trader reports all gains and losses from securities held in connection with the trading business, in- cluding securities held at the end of the year, in Part II of Form 4797. If you pre- viously made the election, see the In- structions for Form 4797. For details on making the mark-to-market election for 2013, see Pub. 550 or Rev. Proc. 99-17, 1999-1 C.B. 503. You can find Rev. Proc. 99-17 starting on the bottom of page 52 of Internal Revenue Bulletin 1999-7 at www.irs.gov/pub/irs­irbs/ irb99­07.pdf.

If you hold securities for investment, you must identify them as such in your records on the day you acquired them (for example, by holding the securities in a separate brokerage account). Securi-

ties held for investment are not marked-to-market.

Short Sales A short sale is a contract to sell property you borrowed for delivery to a buyer. At a later date, you either buy substantially identical property and deliver it to the lender or deliver property that you held but did not want to transfer at the time of the sale.

Example. You think the value of XYZ stock will drop. You borrow 10 shares from your broker and sell them for $100. This is a short sale. You later buy 10 shares for $80 and deliver them to your broker to close the short sale. Your gain is $20 ($100 − $80). Holding period. Usually, your holding period is the amount of time you actual- ly held the property eventually delivered to the lender to close the short sale. However, your gain when closing a short sale is short term if you (a) held substantially identical property for 1 year or less on the date of the short sale, or (b) acquired property substantially identical to the property sold short after the short sale but on or before the date you close the short sale. If you held sub- stantially identical property for more than 1 year on the date of a short sale, any loss realized on the short sale is a long-term capital loss, even if the prop- erty used to close the short sale was held 1 year or less. Reporting a short sale. Report any short sale on Form 8949 in the year it closes.

If a short sale closed in 2012 but you did not get a 2012 Form 1099-B (or sub- stitute statement) for it because you en- tered into it before 2011, report it in Part I or Part II (whichever applies) of a Form 8949 with box C checked on that page. In column (a), enter (for example) “100 sh. XYZ Co.–2010 short sale closed.” Fill in the other columns ac- cording to their instructions. Report the short sale the same way if you received a 2012 Form 1099-B (or substitute state- ment) that does not show proceeds (sales price).

Gain or Loss From Options Report on Form 8949 gain or loss from the closing or expiration of an option that is not a section 1256 contract but is a capital asset in your hands. If an op-

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tion you purchased expired, enter the ex- piration date in column (c) and enter “EXPIRED” in column (d). If an option that was granted (written) expired, enter the expiration date in column (b) and en- ter “EXPIRED” in column (e). Fill in the other columns according to their in- structions. See Pub. 550 for details.

If a call option you sold was exer- cised and the option premium you re- ceived was not reflected in the proceeds (sales price) shown on the Form 1099-B (or substitute statement) you received, enter the premium as a positive number in column (g) of Form 8949. Enter “E” in column (f).

Example. For $10, you sold Joe an option to buy one share of XYZ stock for $80. Joe later exercised the option. The Form 1099-B you get shows the proceeds to be $80. Enter $80 in column (d) of Form 8949. Enter “E” in column (f) and $10 in column (g). Complete the other columns according to the instruc- tions.

Undistributed Capital Gains Include on Schedule D, line 11, the amount from box 1a of Form 2439. This represents your share of the undistrib- uted long-term capital gains of the regu- lated investment company (including a mutual fund) or real estate investment trust.

If there is an amount in box 1b, in- clude that amount on line 11 of the Un- recaptured Section 1250 Gain Work- sheet if you complete line 19 of Sched- ule D.

If there is an amount in box 1c, see Exclusion of Gain on Qualified Small Business (QSB) Stock, later.

If there is an amount in box 1d, in- clude that amount on line 4 of the 28% Rate Gain Worksheet if you complete line 18 of Schedule D.

Include on Form 1040, line 71, or Form 1040NR, line 67, the tax paid as shown in box 2 of Form 2439. Also check the box for Form 2439. Add to the basis of your stock the excess of the amount included in income over the amount of the credit for the tax paid. See Pub. 550 for details.

Installment Sales If you sold property (other than publicly traded stocks or securities) at a gain and

you will receive a payment in a tax year after the year of sale, you generally must report the sale on the installment method unless you elect not to. Use Form 6252 to report the sale on the installment method. Also use Form 6252 to report any payment received in 2012 from a sale made in an earlier year that you re- ported on the installment method.

To elect out of the installment meth- od, report the full amount of the gain on Form 8949 on a timely filed return (in- cluding extensions) for the year of the sale. If your original return was filed on time, you can make the election on an amended return filed no later than 6 months after the due date of your return (excluding extensions). Write “Filed pursuant to section 301.9100-2” at the top of the amended return.

Demutualization of Life Insurance Companies Demutualization of a life insurance company occurs when a mutual life in- surance company changes to a stock company. If you were a policyholder or annuitant of the mutual company, you may have received either stock in the stock company or cash in exchange for your equity interest in the mutual com- pany. The basis of your equity interest in the mutual company is considered to be zero.

If the demutualization transaction qualifies as a tax-free reorganization, no gain is recognized on the exchange of your equity interest in the mutual com- pany for stock. The company can advise you if the transaction is a tax-free reor- ganization. Because the basis of your equity interest in the mutual company is considered to be zero, your basis in the stock received is zero. Your holding pe- riod for the new stock includes the peri- od you held an equity interest in the mu- tual company. If you received cash in exchange for your equity interest, you must recognize a capital gain in an amount equal to the cash received. If you held the equity interest for more than 1 year, report the gain as a long-term capital gain in Part II of Form 8949. If you held the equity interest for 1 year or less, report the gain as a short-term capital gain in Part I of Form 8949. Be sure the appropriate box is checked at the top of Form 8949.

If the demutualization transaction does not qualify as a tax-free reorganiza- tion, you must recognize a capital gain in an amount equal to the cash and fair market value of the stock received. If you held the equity interest for more than 1 year, report the gain as a long-term capital gain in Part II of Form 8949. If you held the equity interest for 1 year or less, report the gain as a short-term capital gain in Part I of Form 8949. Be sure the appropriate box is checked at the top of Form 8949. Your holding period for the new stock begins on the day after you received the stock.

Small Business (Section 1244) Stock Report an ordinary loss from the sale, exchange, or worthlessness of small business (section 1244) stock on Form 4797. However, if the total loss is more than the maximum amount that can be treated as an ordinary loss, also report the transaction on Form 8949 as follows.

1. In column (a), enter “Capital por- tion of section 1244 stock loss.”

2. Complete columns (b) and (c) as you normally would.

3. In column (d), enter the entire sales price of the stock sold.

4. In column (e), enter the entire ba- sis of the stock sold.

5. Enter “S” in column (f). See the instructions for Form 8949, columns (f), (g), and (h).

6. In column (g), enter the loss you claimed on Form 4797 for this transac- tion. Enter it as a positive number.

7. Complete column (h) according to its instructions.

Report the transaction in Part I or Part II of Form 8949 (depending on how long you held the stock) with the appro- priate box (A, B, or C) checked.

Example. You sold section 1244 stock for $1,000. Your basis was $60,000. You had held the stock for 3 years. You can claim $50,000 of your loss as an ordinary loss on Form 4797. To claim the rest of the loss on Form 8949, check the appropriate box at the top. Enter $1,000 on Form 8949, Part II, column (d). Enter $60,000 in column (e). Enter “S” in column (f) and $50,000 (the ordinary loss claimed on Form 4797) in column (g). In column (h), en-

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ter ($9,000) ($1,000 − $60,000 + $50,000). Put it in parentheses to show it is a negative amount.

Exclusion of Gain on Qualified Small Business (QSB) Stock Section 1202 allows for an exclusion of up to 50% of the eligible gain on the sale or exchange of QSB stock. The sec- tion 1202 exclusion applies only to QSB stock held for more than 5 years. The exclusion can be up to 60% for certain empowerment zone business stock. See Empowerment Zone Business Stock, lat- er.

To be QSB stock, the stock must meet all of the following tests.

1. It must be stock in a C corpora- tion (that is, not S corporation stock).

2. It must have been originally is- sued after August 10, 1993.

3. As of the date the stock was is- sued, the corporation was a domestic C corporation with total gross assets of $50 million or less (a) at all times after August 9, 1993, and before the stock was issued, and (b) immediately after the stock was issued. Gross assets in- clude those of any predecessor of the corporation. All corporations that are members of the same parent-subsidiary controlled group are treated as one cor- poration.

4. You must have acquired the stock at its original issue (either directly or through an underwriter), either in ex- change for money or other property or as pay for services (other than as an un- derwriter) to the corporation. In certain cases, you may meet this test if you ac- quired the stock from another person who met the test (such as by gift or in- heritance) or through a conversion or ex- change of QSB stock you held.

5. During substantially all the time you held the stock:

a. The corporation was a C corpora- tion,

b. At least 80% of the value of the corporation's assets were used in the ac- tive conduct of one or more qualified businesses (defined next), and

c. The corporation was not a foreign corporation, DISC, former DISC, regu- lated investment company, real estate in- vestment trust, REMIC, FASIT, cooper-

ative, or a corporation that has made (or that has a subsidiary that has made) a section 936 election.

SSBIC. A specialized small business investment company (SSBIC) is treated as having

met test 5b.

Definition of qualified business. A qualified business is any business that is not one of the following.

A business involving services per- formed in the fields of health, law, engi- neering, architecture, accounting, actua- rial science, performing arts, consulting, athletics, financial services, or brokerage services.

A business whose principal asset is the reputation or skill of one or more employees.

A banking, insurance, financing, leasing, investing, or similar business.

A farming business (including the raising or harvesting of trees).

A business involving the produc- tion of products for which percentage depletion can be claimed.

A business of operating a hotel, motel, restaurant, or similar business.

For more details about limits and ad- ditional requirements that may apply, see Pub. 550 or section 1202.

Empowerment Zone Business Stock You generally can exclude up to 60% of your gain if you meet the following ad- ditional requirements.

1. The stock you sold or exchanged was stock in a corporation that qualified as an empowerment zone business dur- ing substantially all of the time you held the stock.

2. You acquired the stock after De- cember 21, 2000.

Requirement 1 will still be met if the corporation ceased to qualify after the 5-year period that began on the date you acquired the stock. However, the gain that qualifies for the 60% exclusion can- not be more than the gain you would have had if you had sold the stock on the date the corporation ceased to qualify.

For more information about empow- erment zone businesses, see section 1397C.

TIP

Pass-Through Entities If you held an interest in a pass-through entity (a partnership, S corporation, or mutual fund or other regulated invest- ment company) that sold QSB stock, to qualify for the exclusion you must have held the interest on the date the pass-through entity acquired the QSB stock and at all times thereafter until the stock was sold.

How To Report Report the sale or exchange of the QSB stock on Form 8949, Part II, with the ap- propriate box checked, as you would if you were not taking the exclusion. Then enter “Q” in column (f) and enter the amount of the excluded gain as a nega- tive number in column (g). Put it in pa- rentheses to show it is negative. See the instructions for Form 8949, columns (f), (g), and (h). Complete all remaining col- umns. If you are completing line 18 of Schedule D, enter as a positive number the amount of your allowable exclusion on line 2 of the 28% Rate Gain Work- sheet; if you excluded 60% of the gain, enter 2 3 of the exclusion. Gain from Form 1099-DIV. If you re- ceived a Form 1099-DIV with a gain in box 2c, part or all of that gain (which is also included in box 2a) may be eligible for the section 1202 exclusion. In col- umn (a) of Form 8949, Part II, enter the name of the corporation whose stock was sold. In column (f), enter “Q” and in column (g) enter the amount of the ex- cluded gain as a negative number. See the instructions for Form 8949, columns (f), (g), and (h). If you are completing line 18 of Schedule D, enter as a posi- tive number the amount of your allowa- ble exclusion on line 2 of the 28% Rate Gain Worksheet; if you excluded 60% of the gain, enter 2 3 of the exclusion. Gain from Form 2439. If you received a Form 2439 with a gain in box 1c, part or all of that gain (which is also included in box 1a) may be eligible for the sec- tion 1202 exclusion. In column (a) of Form 8949, Part II, enter the name of the corporation whose stock was sold. In column (f), enter “Q” and in column (g) enter the amount of the excluded gain as a negative number. See the instructions for Form 8949, columns (f), (g), and (h). If you are completing line 18 of Sched- ule D, enter as a positive number the

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amount of your allowable exclusion on line 2 of the 28% Rate Gain Worksheet; if you excluded 60% of the gain, enter 2 3 of the exclusion. Gain from an installment sale of QSB stock. If all payments are not received in the year of sale, a sale of QSB stock that is not traded on an established se- curities market generally is treated as an installment sale and is reported on Form 6252. Figure the allowable section 1202 exclusion for the year by multiplying the total amount of the exclusion by a frac- tion, the numerator of which is the amount of eligible gain to be recognized for the tax year and the denominator of which is the total amount of eligible gain. In column (a) of Form 8949, Part II, enter the name of the corporation whose stock was sold. In column (f), en- ter “Q” and in column (g) enter the amount of the allowable exclusion for the year as a negative number. See the instructions for Form 8949, columns (f), (g), and (h). If you are completing line 18 of Schedule D, enter as a posi- tive number the amount of your allowa- ble exclusion for the year on line 2 of the 28% Rate Gain Worksheet; if you excluded 60% of the gain, enter 2 3 of the allowable exclusion for the year. Alternative minimum tax. You must enter 7% of your allowable exclusion for the year on line 13 of Form 6251.

Rollover of Gain From QSB Stock If you sold QSB stock (defined earlier) that you held for more than 6 months, you can elect to postpone gain if you buy other QSB stock during the 60-day period that began on the date of the sale. A pass-through entity also can make the election to postpone gain. The benefit of the postponed gain applies to your share of the entity's postponed gain if you held an interest in the entity for the entire pe- riod the entity held the QSB stock. If a pass-through entity sold QSB stock held for more than 6 months and you held an interest in the entity for the entire period the entity held the stock, you also can elect to postpone gain if you, rather than the pass-through entity, buy the replace- ment QSB stock within the 60-day peri- od. If you were a partner in a partnership that sold or bought QSB stock, see box 11 of the Schedule K-1 (Form 1065)

sent to you by the partnership and Regu- lations section 1.1045-1.

You must recognize gain to the ex- tent the sale proceeds are more than the cost of the replacement stock. Reduce the basis of the replacement stock by any postponed gain.

You must make the election no later than the due date (including extensions) for filing your tax return for the tax year in which the QSB stock was sold. If your original return was filed on time, you can make the election on an amen- ded return filed no later than 6 months after the due date of your return (exclud- ing extensions). Write “Filed pursuant to section 301.9100-2” at the top of the amended return.

To make the election, report the sale in Part I or Part II (depending on how long you owned the stock) of Form 8949 as you would if you were not making the election. Then enter “R” in column (f). Enter the amount of the postponed gain as a negative number in column (g). Put it in parentheses to show it is negative. See the instructions for Form 8949, col- umns (f), (g), and (h). Complete all re- maining columns.

Exclusion of Gain From DC Zone Assets If you sold or exchanged a District of Columbia Enterprise Zone (DC Zone) asset that you acquired after 1997 and held for more than 5 years, you may be able to exclude the amount of qualified capital gain that you would otherwise in- clude in income. The exclusion applies to an interest in, or property of, certain businesses operating in the District of Columbia. DC Zone asset. A DC Zone asset is any of the following.

DC Zone business stock. DC Zone partnership interest. DC Zone business property.

Qualified capital gain. Qualified capi- tal gain is any gain recognized on the sale or exchange of a DC Zone asset that is a capital asset or property used in a trade or business. It does not include any of the following gains.

Gain treated as ordinary income under section 1245.

Section 1250 gain figured as if sec- tion 1250 applied to all depreciation rather than the additional depreciation.

Gain attributable to real property, or an intangible asset, that is not an inte- gral part of a DC Zone business.

Gain from a related-party transac- tion. See Sales and Exchanges Between Related Persons in chapter 2 of Pub. 544.

See section 1400B for more details. How to report. Report the sale or ex- change on Form 8949, Part II, as you would if you were not taking the exclu- sion. Then enter “X” in column (f). En- ter the amount of the exclusion as a neg- ative number in column (g). Put it in parentheses to show it is negative. See the instructions for Form 8949, columns (f), (g), and (h). Complete all remaining columns.

Exclusion of Gain From Qualified Community Assets If you sold or exchanged a qualified community asset that you acquired after 2001 and before 2010 and held for more than 5 years, you may be able to exclude the qualified capital gain that you would otherwise include in income. The exclu- sion applies to an interest in, or property of, certain renewal community business- es. Qualified community asset. A quali- fied community asset is any of the fol- lowing.

Qualified community stock. Qualified community partnership

interest. Qualified community business

property. Qualified capital gain. Qualified capi- tal gain is any gain recognized on the sale or exchange of a qualified commun- ity asset but does not include any of the following.

Gain treated as ordinary income under section 1245.

Section 1250 gain figured as if sec- tion 1250 applied to all depreciation rather than the additional depreciation.

Gain attributable to real property, or an intangible asset, that is not an inte- gral part of a qualified community busi- ness.

Gain from a related-party transac- tion. See Sales and Exchanges Between Related Persons in chapter 2 of Pub. 544.

See section 1400F for more details and special rules.

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How to report. Report the sale or ex- change on Form 8949, Part II, with the appropriate box checked, as you would if you were not taking the exclusion. Then enter “X” in column (f) and enter the amount of the exclusion as a nega- tive number in column (g). Put it in pa- rentheses to show it is negative. See the instructions for Form 8949, columns (f), (g), and (h). Complete all remaining col- umns.

Rollover of Gain From Publicly Traded Securities You can postpone all or part of any gain from the sale of publicly traded securi- ties by buying common stock or a part- nership interest in a specialized small business investment company during the 60-day period that began on the date of the sale. See Pub. 550. Also see the in- structions for Form 8949, columns (f), (g), and (h).

Rollover of Gain From Stock Sold to ESOPs or Certain Cooperatives You can postpone all or part of any gain from the sale of qualified securities, held for at least 3 years, to an employee stock ownership plan (ESOP) or eligible worker-owned cooperative, if you buy qualified replacement property. See Pub. 550. Also see the instructions for Form 8949, columns (f), (g), and (h).

Specific Instructions Rounding Off to Whole Dollars You can round off cents to whole dollars on your Schedule D. 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 exam-

ple, $1.39 becomes $1 and $2.50 be- comes $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.

Lines 1, 2, 3, 8, 9, and 10, Column (h)—Gain or Loss Figure gain or loss on each line. First, subtract the cost or other basis in col- umn (e) from the proceeds (sales price) in column (d). Then combine the result with any adjustments in column (g). En- ter the gain or loss in column (h). Enter negative amounts in parentheses.

Example 1 – gain. Column (d) is $6,000 and column (e) is $2,000. Enter $4,000 in column (h).

Example 2 – loss. Column (d) is $6,000 and column (e) is $8,000. Enter ($2,000) in column (h).

Example 3 – adjustment. Column (d) is $6,000, column (e) is $2,000, and

Capital Loss Carryover Worksheet—Lines 6 and 14 Keep for Your Records Use this worksheet to figure your capital loss carryovers from 2011 to 2012 if your 2011 Schedule D, line 21, is a loss and (a) that loss is a smaller loss than the loss on your 2011 Schedule D, line 16, or (b) the amount on your 2011 Form 1040, line 41 (or your 2011 Form 1040NR, line 39, if applicable) is less than zero. Otherwise, you do not have any carryovers.

If you and your spouse once filed a joint return and are filing separate returns for 2012, any capital loss carryover from the joint return can be deducted only on the return of the spouse who actually had the loss.

1. Enter the amount from your 2011 Form 1040, line 41, or your 2011 Form 1040NR, line 39. If a loss, enclose the amount in parentheses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. Enter the loss from your 2011 Schedule D, line 21, as a positive amount . . . . . . . . . . . . . . . . . . . . . . 2.

3. Combine lines 1 and 2. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.

4. Enter the smaller of line 2 or line 3 . . . . . . . . . . . . . . . . . . . . 4.

If line 7 of your 2011 Schedule D is a loss, go to line 5; otherwise, enter -0- on line 5 and go to line 9.

5. Enter the loss from your 2011 Schedule D, line 7, as a positive amount . . . . . . . . . . . . . . . . . . . . . . . 5.

6. Enter any gain from your 2011 Schedule D, line 15. If a loss, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.

7. Add lines 4 and 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.

8. Short-term capital loss carryover for 2012. Subtract line 7 from line 5. If zero or less, enter -0-. If more than zero, also enter this amount on Schedule D, line 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.

If line 15 of your 2011 Schedule D is a loss, go to line 9; otherwise, skip lines 9 through 13. 9. Enter the loss from your 2011 Schedule D, line 15, as a positive amount . . . . . . . . . . . . . . . . . . . . . . 9.

10. Enter any gain from your 2011 Schedule D, line 7. If a loss, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.

11. Subtract line 5 from line 4. If zero or less, enter -0- . . . . . . . . . 11.

12. Add lines 10 and 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.

13. Long-term capital loss carryover for 2012. Subtract line 12 from line 9. If zero or less, enter -0-. If more than zero, also enter this amount on Schedule D, line 14 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.

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column (g) is ($1,000). Enter $3,000 ($6,000 − $2,000 − $1,000) in column (h).

Line 13 See Capital Gain Distributions, earlier.

Line 18 If you checked “Yes” on line 17, com- plete the 28% Rate Gain Worksheet in these instructions if either of the follow- ing apply for 2012.

You reported in Part II of Form 8949 a section 1202 exclusion from the eligible gain on qualified small business stock (see Exclusion of Gain on Quali­ fied Small Business (QSB) Stock, earli- er).

You reported in Part II of Form 8949 a collectibles gain or (loss). A col- lectibles gain or (loss) is any long-term gain or deductible long-term loss from the sale or exchange of a collectible that is a capital asset.

Collectibles include works of art, rugs, antiques, metals (such as gold, sil- ver, and platinum bullion), gems, stamps, coins, alcoholic beverages, and certain other tangible property.

Include on the worksheet any gain (but not loss) from the sale or exchange of an interest in a partnership, S corpora- tion, or trust held for more than 1 year and attributable to unrealized apprecia- tion of collectibles. For details, see Reg- ulations section 1.1(h)-1. Also, attach the statement required under Regula- tions section 1.1(h)-1(e).

Line 19 If you checked “Yes” on line 17, com- plete the Unrecaptured Section 1250 Gain Worksheet in these instructions if any of the following apply for 2012.

You sold or otherwise disposed of section 1250 property (generally, real property that you depreciated) held more than 1 year.

You received installment payments for section 1250 property held more than 1 year for which you are reporting gain on the installment method.

You received a Schedule K-1 from an estate or trust, partnership, or S cor- poration that shows “unrecaptured sec- tion 1250 gain.”

You received a Form 1099-DIV or Form 2439 from a real estate investment trust or regulated investment company (including a mutual fund) that reports “unrecaptured section 1250 gain.”

You reported a long-term capital gain from the sale or exchange of an in- terest in a partnership that owned section 1250 property.

Instructions for the Unrecaptured Section 1250 Gain Worksheet Lines 1 through 3. If you had more than one property described on line 1, complete lines 1 through 3 for each property on a separate worksheet. Enter the total of the line 3 amounts for all properties on line 3 and go to line 4. Line 4. To figure the amount to enter on line 4, follow the steps below for

each installment sale of trade or business property held more than 1 year.

Step 1. Figure the smaller of (a) the depreciation allowed or allowable, or (b) the total gain for the sale. This is the smaller of line 22 or line 24 of your 2012 Form 4797 (or the comparable lines of Form 4797 for the year of sale) for the property.

Step 2. Reduce the amount figured in step 1 by any section 1250 ordinary in- come recapture for the sale. This is the amount from line 26g of your 2012 Form 4797 (or the comparable line of Form 4797 for the year of sale) for the property. The result is your total unrec- aptured section 1250 gain that must be allocated to the installment payments re- ceived from the sale.

Step 3. Generally, the amount of sec- tion 1231 gain on each installment pay- ment is treated as unrecaptured section 1250 gain until the total unrecaptured section 1250 gain figured in step 2 has been used in full. Figure the amount of gain treated as unrecaptured section 1250 gain for installment payments re- ceived in 2012 as the smaller of (a) the amount from line 26 or line 37 of your 2012 Form 6252, whichever applies, or (b) the amount of unrecaptured section 1250 gain remaining to be reported. This amount is generally the total unrecap- tured section 1250 gain for the sale re- duced by all gain reported in prior years (excluding section 1250 ordinary in- come recapture). However, if you chose not to treat all of the gain from payments

28% Rate Gain Worksheet—Line 18 Keep for Your Records 1. Enter the total of all collectibles gain or (loss) from items you reported on Form 8949, Part II . . . . . . . . . . . . . . . . . . . 1.

2. Enter as a positive number the amount of any section 1202 exclusion you reported in column (g) of Form 8949, Part II, with code “Q” in column (f), for which you excluded 50% of the gain, plus 2 3 of any section 1202 exclusion you reported in column (g) of Form 8949, Part II, with code “Q” in column (f), for which you excluded 60% of the gain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.

3. Enter the total of all collectibles gain or (loss) from Form 4684, line 4 (but only if Form 4684, line 15, is more than zero); Form 6252; Form 6781, Part II; and Form 8824 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.

4. Enter the total of any collectibles gain reported to you on: Form 1099-DIV, box 2d; Form 2439, box 1d; and Schedule K-1 from a partnership, S corporation, estate, or trust.

. . . . . . . . . . . . . . . . . . . . 4.

5. Enter your long-term capital loss carryovers from Schedule D, line 14, and Schedule K-1 (Form 1041), box 11, code C . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.

( )

6. If Schedule D, line 7, is a (loss), enter that (loss) here. Otherwise, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6. ( )

7. Combine lines 1 through 6. If zero or less, enter -0-. If more than zero, also enter this amount on Schedule D, line 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.

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received after May 6, 1997, and before August 24, 1999, as unrecaptured sec- tion 1250 gain, use only the amount you chose to treat as unrecaptured section 1250 gain for those payments to reduce the total unrecaptured section 1250 gain remaining to be reported for the sale. In- clude this amount on line 4. Line 10. Include on line 10 your share of the partnership's unrecaptured section 1250 gain that would result if the part- nership had transferred all of its section 1250 property in a fully taxable transac- tion immediately before you sold or ex- changed your interest in that partnership. If you recognized less than all of the re- alized gain, the partnership will be trea- ted as having transferred only a propor- tionate amount of each section 1250 property. For details, see Regulations section 1.1(h)-1. Also attach the state- ment required under Regulations section 1.1(h)-1(e). Line 12. An example of an amount to include on line 12 is unrecaptured sec- tion 1250 gain from the sale of a vaca- tion home you previously used as a rent-

al property but converted to personal use prior to the sale. To figure the amount to enter on line 12, follow the applicable instructions below.

Installment sales. To figure the amount to include on line 12, follow the steps below for each installment sale of property held more than 1 year for which you did not make an entry in Part I of your Form 4797 for the year of sale.

Step 1. Figure the smaller of (a) the depreciation allowed or allowable, or (b) the total gain for the sale. This is the smaller of line 22 or line 24 of your 2012 Form 4797 (or the comparable lines of Form 4797 for the year of sale) for the property.

Step 2. Reduce the amount figured in step 1 by any section 1250 ordinary income recapture for the sale. This is the amount from line 26g of your 2012 Form 4797 (or the comparable line of Form 4797 for the year of sale) for the property. The result is your total unrec- aptured section 1250 gain that must be allocated to the installment payments re- ceived from the sale.

Step 3. Generally, the amount of capital gain on each installment payment is treated as unrecaptured section 1250 gain until the total unrecaptured section 1250 gain figured in step 2 has been used in full. Figure the amount of gain treated as unrecaptured section 1250 gain for installment payments received in 2012 as the smaller of (a) the amount from line 26 or line 37 of your 2012 Form 6252, whichever applies, or (b) the amount of unrecaptured section 1250 gain remaining to be reported. This amount is generally the total unrecap- tured section 1250 gain for the sale re- duced by all gain reported in prior years (excluding section 1250 ordinary in- come recapture). However, if you chose not to treat all of the gain from payments received after May 6, 1997, and before August 24, 1999, as unrecaptured sec- tion 1250 gain, use only the amount you chose to treat as unrecaptured section 1250 gain for those payments to reduce the total unrecaptured section 1250 gain remaining to be reported for the sale. In- clude this amount on line 12.

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Unrecaptured Section 1250 Gain Worksheet—Line 19 Keep for Your Records If you are not reporting a gain on Form 4797, line 7, skip lines 1 through 9 and go to line 10.

1. If you have a section 1250 property in Part III of Form 4797 for which you made an entry in Part I of Form 4797 (but not on Form 6252), enter the smaller of line 22 or line 24 of Form 4797 for that property. If you did not have any such property, go to line 4. If you had more than one such property, see instructions . . . . . . . . . . 1.

2. Enter the amount from Form 4797, line 26g, for the property for which you made an entry on line 1 . . . . . . . . 2. 3. Subtract line 2 from line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3. 4. Enter the total unrecaptured section 1250 gain included on line 26 or line 37 of Form(s) 6252 from installment

sales of trade or business property held more than 1 year (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. 5. Enter the total of any amounts reported to you on a Schedule K-1 from a partnership or an S corporation as

“unrecaptured section 1250 gain” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. 6. Add lines 3 through 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6. 7. Enter the smaller of line 6 or the gain from Form 4797, line 7 . . . . . . . . . . . . . . . . . . 7. 8. Enter the amount, if any, from Form 4797, line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8. 9. Subtract line 8 from line 7. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.

10. Enter the amount of any gain from the sale or exchange of an interest in a partnership attributable to unrecaptured section 1250 gain (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.

11. Enter the total of any amounts reported to you as “unrecaptured section 1250 gain” on a Schedule K-1, Form 1099-DIV, or Form 2439 from an estate, trust, real estate investment trust, or mutual fund (or other regulated investment company) or in connection with a Form 1099-R . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.

12. Enter the total of any unrecaptured section 1250 gain from sales (including installment sales) or other dispositions of section 1250 property held more than 1 year for which you did not make an entry in Part I of Form 4797 for the year of sale (see instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.

13. Add lines 9 through 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13. 14. If you had any section 1202 gain or collectibles gain or (loss), enter the total of lines 1

through 4 of the 28% Rate Gain Worksheet. Otherwise, enter -0- . . . . . . . . . . . . . . 14. 15. Enter the (loss), if any, from Schedule D, line 7. If Schedule D, line 7, is zero or a

gain, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15. ( ) 16. Enter your long-term capital loss carryovers from Schedule D, line 14, and

Schedule K-1 (Form 1041), box 11, code C* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16. ( ) 17. Combine lines 14 through 16. If the result is a (loss), enter it as a positive amount. If the result is zero or a gain,

enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17. 18. Unrecaptured section 1250 gain. Subtract line 17 from line 13. If zero or less, enter -0-. If more than zero,

enter the result here and on Schedule D, line 19 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.

*If you are filing Form 2555 or 2555-EZ (relating to foreign earned income), see the footnote in the Foreign Earned Income Tax Worksheet in the Form 1040 instructions before completing this line.

Other sales or dispositions of section 1250 property. For each sale of proper- ty held more than 1 year (for which you did not make an entry in Part I of Form 4797), figure the smaller of (a) the de- preciation allowed or allowable, or (b) the total gain for the sale. This is the smaller of line 22 or line 24 of Form 4797 for the property. Next, reduce that amount by any section 1250 ordinary in- come recapture for the sale. This is the amount from line 26g of Form 4797 for

the property. The result is the total un- recaptured section 1250 gain for the sale. Include this amount on line 12.

Line 21 You have a capital loss carryover from 2012 to 2013 if you have a loss on line 16 and either:

That loss is more than the loss on line 21, or

The amount on Form 1040, line 41 (or Form 1040NR, line 39, if applica- ble), is less than zero.

To figure any capital loss carryover to 2013, you will use the Capital Loss Carryover Worksheet in the 2013 In- structions for Schedule D. If you want to figure your carryover to 2013 now, see Pub. 550.

You will need a copy of your 2012 Form 1040 and Sched­ ule D to figure your capital

loss carryover to 2013.

TIP

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Schedule D Tax Worksheet Keep for Your Records Complete this worksheet only if line 18 or line 19 of Schedule D is more than zero. Otherwise, complete the Qualified Dividends and Capital Gain Tax Worksheet in the Instructions for Form 1040, line 44 (or in the Instructions for Form 1040NR, line 42) to figure your tax. Before completing this worksheet, complete Form 1040 through line 43 (or Form 1040NR through line 41). Exception: Do not use the Qualified Dividends and Capital Gain Tax Worksheet or this worksheet to figure your tax if:

Line 15 or line 16 of Schedule D is zero or less and you have no qualified dividends on Form 1040, line 9b (or Form 1040NR, line 10b); or Form 1040, line 43 (or Form 1040NR, line 41) is zero or less.

Instead, see the instructions for Form 1040, line 44 (or Form 1040NR, line 42).

1. Enter your taxable income from Form 1040, line 43 (or Form 1040NR, line 41). (However, if you are filing Form 2555 or 2555-EZ (relating to foreign earned income), enter instead the amount from line 3 of the Foreign Earned Income Tax Worksheet in the Instructions for Form 1040, line 44) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. Enter your qualified dividends from Form 1040, line 9b (or Form 1040NR, line 10b) . . . . . . . . . . . . . . . . . . . . . . . 2.

3. Enter the amount from Form 4952 (used to figure investment interest expense deduction), line 4g . . . . . . . 3.

4. Enter the amount from Form 4952, line 4e* . . . . . . . . . . . . . . . . . . . . 4.

5. Subtract line 4 from line 3. If zero or less, enter -0- . . . . . . 5. 6. Subtract line 5 from line 2. If zero or less, enter -0-** . . . . . . . . . . . . . . . . . . . . 6. 7. Enter the smaller of line 15 or line 16 of Schedule D . . . . . 7. 8. Enter the smaller of line 3 or line 4 . . . . . . . . . . . . . . . . 8. 9. Subtract line 8 from line 7. If zero or less, enter -0-** . . . . . . . . . . . . . . . . . . . . 9.

10. Add lines 6 and 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10. 11. Add lines 18 and 19 of Schedule D** . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11. 12. Enter the smaller of line 9 or line 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12. 13. Subtract line 12 from line 10 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13. 14. Subtract line 13 from line 1. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14. 15. Enter:

• $35,350 if single or married filing separately; • $70,700 if married filing jointly or qualifying widow(er); or • $47,350 if head of household . . . . . . . 15.

16. Enter the smaller of line 1 or line 15 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16. 17. Enter the smaller of line 14 or line 16 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17. 18. Subtract line 10 from line 1. If zero or less, enter -0- . . . . . 18. 19. Enter the larger of line 17 or line 18 19. 20. Subtract line 17 from line 16. This amount is taxed at 0%. 20.

If lines 1 and 16 are the same, skip lines 21 through 33 and go to line 34. Otherwise, go to line 21. 21. Enter the smaller of line 1 or line 13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21. 22. Enter the amount from line 20 (if line 20 is blank, enter -0-) . . . . . . . . . . . . . . . . 22. 23. Subtract line 22 from line 21. If zero or less, enter -0- 23. 24. Multiply line 23 by 15% (.15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24.

If Schedule D, line 19, is zero or blank, skip lines 25 through 30 and go to line 31. Otherwise, go to line 25. 25. Enter the smaller of line 9 above or Schedule D, line 19 . . . . . . . . . . . . . . . . . . . 25. 26. Add lines 10 and 19 . . . . . . . . . . . . . . . . . . . . . . . . . . 26. 27. Enter the amount from line 1 above . . . . . . . . . . . . . . . . 27. 28. Subtract line 27 from line 26. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . 28. 29. Subtract line 28 from line 25. If zero or less, enter -0- 29. 30. Multiply line 29 by 25% (.25) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30.

If Schedule D, line 18, is zero or blank, skip lines 31 through 33 and go to line 34. Otherwise, go to line 31. 31. Add lines 19, 20, 23, and 29 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31. 32. Subtract line 31 from line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32. 33. Multiply line 32 by 28% (.28) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33. 34. Figure the tax on the amount on line 19. If the amount on line 19 is less than $100,000, use the Tax Table to figure the tax. If the

amount on line 19 is $100,000 or more, use the Tax Computation Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34. 35. Add lines 24, 30, 33, and 34 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35. 36. Figure the tax on the amount on line 1. If the amount on line 1 is less than $100,000, use the Tax Table to figure the tax. If the

amount on line 1 is $100,000 or more, use the Tax Computation Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36. 37. Tax on all taxable income (including capital gains and qualified dividends). Enter the smaller of line 35 or line 36. Also include

this amount on Form 1040, line 44 (or Form 1040NR, line 42). (If you are filing Form 2555 or 2555-EZ, do not enter this amount on Form 1040, line 44. Instead, enter it on line 4 of the Foreign Earned Income Tax Worksheet in the Form 1040 instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37.

*If applicable, enter instead the smaller amount you entered on the dotted line next to line 4e of Form 4952. **If you are filing Form 2555 or 2555-EZ, see the footnote in the Foreign Earned Income Tax Worksheet in the Instructions for Form 1040, line 44, before completing this line.

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Department of the Treasury Internal Revenue Service

2012 Instructions for Schedule E (Form 1040) Supplemental Income and Loss

Use Schedule E (Form 1040) to report income or loss from rental real estate, royalties, partnerships, S corporations, estates, trusts, and residual interests in REMICs.

You can attach your own schedule(s) to report income or loss from any of these sources. Use the same format as on Schedule E.

Enter separately on Schedule E the total income and the total loss for each part. En- close loss figures in (parentheses).

Section references are to the Internal Revenue Code unless otherwise noted.

Future Developments For the latest information about devel- opments related to Schedule E (Form 1040) and its instructions, such as legis- lation enacted after they were published, go to www.irs.gov/form1040.

What's New No separate payment card reporting requirements. Gross receipts received via payment card (credit and debit cards) and third party network payments are not separately reported on Schedule E. Information reporting requirements. Lines A and B, which address your re- quired filing of Forms 1099 in 2012, have been moved to Part I. You only need to answer the questions on lines A and B if you are completing Part I. Standard mileage rate. The standard mileage rate for miles driven in connec- tion with your rental activities is 55.5 cents per mile.

General Instructions Other Schedules and Forms You May Have To File

Schedule A (Form 1040) to deduct interest, taxes, and casualty losses not related to your business.

Form 3520 to report certain transactions with foreign trusts and receipt of certain large gifts or bequests from certain foreign persons.

Form 4562 to claim depreciation (including the special allowance) on assets placed in service in 2012, to claim amortization that began in 2012, to make an election under section 179 to

expense certain property, or to report information on listed property.

Form 4684 to report a casualty or theft gain or loss involving property used in your trade or business or income-producing property.

Form 4797 to report sales, exchanges, and involuntary conversions (not from a casualty or theft) of trade or business property.

Form 6198 to figure your allowable loss from an at-risk activity.

Form 8082 to notify the IRS of any inconsistent tax treatment for an item on your return.

Form 8582 to figure allowable passive activity loss.

Form 8824 to report like-kind exchanges.

Form 8826 to claim a credit for expenditures to improve access to your business for individuals with disabilities.

Form 8873 to figure your extraterritorial income exclusion.

Form 8910 to claim a credit for placing a new alternative motor vehicle in service for business use. Single-member limited liability com- pany (LLC). In most cases, a sin- gle-member domestic LLC is not treated as a separate entity for federal income tax purposes. If you are the sole member of a domestic LLC, file Schedule E (or Schedule C, C-EZ, or F, if applicable). However, you can elect to treat a domes- tic LLC as a corporation. See Form 8832 for details on the election and the tax treatment of a foreign LLC. Information returns. You may have to file information returns for wages paid to employees, certain payments of fees and other nonemployee compensation, interest, rents, royalties, real estate trans- actions, annuities, and pensions. You generally use Form 1099-MISC, Miscel-

laneous Income, to report rents and pay- ments of fees and other nonemployee compensation. For details, see Line A, later, and the 2012 General Instructions for Certain Information Returns.

If you received cash of more than $10,000 in one or more related transac- tions in your trade or business, you may have to file Form 8300. For details, see Pub. 1544.

Husband-Wife Qualified Joint Venture If you and your spouse each materially participate (see Material participation in the Instructions for Schedule C) as the only members of a jointly owned and operated rental real estate business and you file a joint return for the tax year, you can elect to be treated as a qualified joint venture instead of a partnership. This election, in most cases, will not in- crease the total tax owed on the joint re- turn. By making the election, you will not be required to file Form 1065 for any year the election is in effect and will instead report the income and deduc- tions directly on your joint return. If you and your spouse filed Form 1065 for the year prior to the election, the partnership terminates at the end of the tax year im- mediately preceding the year the elec- tion takes effect.

Note. Mere joint ownership of property that is not a trade or business does not qualify for the election. Making the election. To make this election for your rental real estate busi- ness, check the “QJV” box on line 2 for each property that is part of the qualified joint venture. You must divide all items of income, gain, loss, deduction, and credit attributable to the rental real estate business between you and your spouse in accordance with your respective

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interests in the venture. Although you and your spouse will not each file your own Schedule E as part of the qualified joint venture, each of you must report your interest as separate properties on line 1 of Schedule E. On lines 3 through 22 for each separate property interest, you must enter your share of the appli- cable income, deduction, or loss.

If you have more than three rental re- al estate or royalty properties, complete and attach as many Schedules E as you need to list them. But fill in lines 23a through 26 on only one Schedule E. The figures on lines 23a through 26 on that Schedule E should be the combined to- tals for all properties reported on your Schedules E.

Once made, the election can be re- voked only with the permission of the IRS. However, the election technically remains in effect only for as long as the spouses filing as a qualified joint ven- ture continue to meet the requirements to be treated as a qualified joint venture. If the spouses fail to meet the qualified joint venture requirements for a year, a new election will be necessary for any future year in which the spouses meet the requirements to be treated as a quali- fied joint venture.

Rental real estate income generally is not included in net earnings from self-employment subject to self-employ- ment tax and generally is subject to pas- sive loss limitation rules. Electing quali- fied joint venture status does not alter the application of the self-employment tax or the passive loss limitation rules.

For more information on qualified joint ventures, go to IRS.gov. Enter “qualified joint venture” in the search box and select “Election for Husband and Wife Unincorporated Businesses.”

Reportable Transaction Disclosure Statement Use Form 8886 to disclose information for each reportable transaction in which you participated. Form 8886 must be filed for each tax year that your federal income tax liability is affected by your participation in the transaction. You may have to pay a penalty if you are required to file Form 8886 but do not do so. You may also have to pay interest and penal- ties on any reportable transaction under- statements. The following are reportable transactions.

Any listed transaction that is the same as or substantially similar to tax avoidance transactions identified by the IRS.

Any transaction offered to you or a related party under conditions of confi- dentiality for which you paid an advisor a fee of at least $50,000.

Certain transactions for which you or a related party have contractual pro- tection against disallowance of the tax benefits.

Certain transactions resulting in a loss of at least $2 million in any single tax year or $4 million in any combina- tion of tax years. (At least $50,000 for a single tax year if the loss arose from a foreign currency transaction defined in section 988(c)(1), whether or not the loss flows through from an S corpora- tion or partnership.)

Certain transactions of interest en- tered into after November 1, 2006, that are the same or substantially similar to transactions that the IRS has identified by notice, regulation, or other form of published guidance as transactions of in- terest.

See the Instructions for Form 8886 for more details.

At-Risk Rules In most cases, you must complete Form 6198 to figure your allowable loss if you have:

A loss from an activity carried on as a trade or business or for the produc- tion of income, and

Amounts in the activity for which you are not at risk.

The at-risk rules in most cases limit the amount of loss (including loss on the disposition of assets) you can claim to the amount you could actually lose in the activity. However, the at-risk rules do not apply to losses from an activity of holding real property placed in service before 1987. They also do not apply to losses from your interest acquired before 1987 in a pass-through entity engaged in such activity. The activity of holding mineral property does not qualify for this exception.

In most cases, you are not at risk for amounts such as the following.

Nonrecourse loans used to finance the activity, to acquire property used in the activity, or to acquire your interest in the activity that are not secured by your

own property (other than property used in the activity). However, there is an ex- ception for certain nonrecourse financ- ing borrowed by you in connection with the activity of holding real property (other than mineral property). See Qualified nonrecourse financing, later.

Cash, property, or borrowed amounts used in the activity (or contrib- uted to the activity, or used to acquire your interest in the activity) that are pro- tected against loss by a guarantee, stop-loss agreement, or other similar ar- rangement (excluding casualty insurance and insurance against tort liability).

Amounts borrowed for use in the activity from a person who has an inter- est in the activity (other than as a cred- itor) or who is related under section 465(b)(3)(C) to a person (other than you) having such an interest. Qualified nonrecourse financing. Qualified nonrecourse financing is trea- ted as an amount at risk if it is secured by real property used in an activity of holding real property subject to the at-risk rules. Qualified nonrecourse fi- nancing is financing for which no one is personally liable for repayment and is:

Borrowed by you in connection with the activity of holding real property (other than mineral property),

Not convertible from a debt obliga- tion to an ownership interest, and

Loaned or guaranteed by any feder- al, state, or local government, or bor- rowed by you from a qualified person. Qualified person. A qualified person is a person who actively and regularly en- gages in the business of lending money, such as a bank or savings and loan asso- ciation. A qualified person cannot be:

Related to you (unless the nonre- course financing obtained is commer- cially reasonable and on substantially the same terms as loans involving unre- lated persons),

The seller of the property (or a per- son related to the seller), or

A person who receives a fee due to your investment in real property (or a person related to that person).

For more details about the at-risk rules, see the Instructions for Form 6198 and Pub. 925.

Passive Activity Loss Rules The passive activity loss rules may limit the amount of losses you can deduct.

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These rules apply to losses in Parts I, II, and III, and line 40 of Schedule E.

Losses from passive activities may be subject first to the at-risk rules. Losses deductible under the at-risk rules are then subject to the passive activity loss rules.

You can deduct losses from passive activities in most cases only to the ex- tent of income from passive activities. An exception for certain rental real es- tate activities (explained later) may ap- ply.

Passive Activity A passive activity is any business activi- ty in which you did not materially par- ticipate and any rental activity, except as explained later. If you are a limited part- ner, in most cases, you are not treated as having materially participated in the partnership's activities for the year.

The rental of real or personal proper- ty is a rental activity under the passive activity loss rules in most cases, but ex- ceptions apply. If your rental of property is not treated as a rental activity, you must determine whether it is a trade or business activity, and if so, whether you materially participated in the activity for the tax year.

See the Instructions for Form 8582 to determine whether you materially par- ticipated in the activity and for the defi- nition of “rental activity.”

See Pub. 925 for special rules that ap- ply to rentals of:

Substantially nondepreciable prop- erty,

Property incidental to development activities, and

Property related to activities in which you materially participate.

Activities That Are Not Passive Activities Activities of real estate professionals. If you were a real estate professional for 2012, any rental real estate activity in which you materially participated is not a passive activity. You were a real estate professional for the year only if you met both of the following conditions.

More than half of the personal services you performed in trades or busi- nesses during the year were performed in real property trades or businesses in which you materially participated.

You performed more than 750 hours of services during the year in real property trades or businesses in which you materially participated.

If you are married filing jointly, ei- ther you or your spouse must meet both of the above conditions without taking into account services performed by the other spouse.

A real property trade or business is any real property development, redevel- opment, construction, reconstruction, ac- quisition, conversion, rental, operation, management, leasing, or brokerage trade or business. Services you performed as an employee are not treated as per- formed in a real property trade or busi- ness unless you owned more than 5% of the stock (or more than 5% of the capital or profits interest) in the employer.

If you qualify as a real estate profes- sional, rental real estate activities in which you materially participated are not passive activities. For purposes of determining whether you materially par- ticipated in your rental real estate activi- ties, each interest in rental real estate is a separate activity unless you elect to treat all your interests in rental real estate as one activity. To make this election, at- tach a statement to your original tax re- turn that declares you are a qualifying taxpayer for the year and you are mak- ing the election under section 469(c)(7) (A). The election applies for the year made and all later years in which you are a real estate professional. You can revoke the election only if your facts and circumstances materially change.

If you did not make this elec­ tion on your timely filed re­ turn, you may be eligible to make a late election to treat

all your interest in rental real estate as one activity. See Rev. Proc. 2011­34, 2011­24 I.R.B. 874, available at www.irs.gov/irb/2011­24_IRB/ ar07.html.

If you were a real estate professional for 2012, complete Schedule E, line 43. Other activities. The rental of a dwell- ing unit that you used as a home is not subject to the passive loss limitation rules. See Line 2, later, to see if you used the dwelling unit as a home.

A working interest in an oil or gas well you held directly or through an en- tity that did not limit your liability is not

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a passive activity even if you did not materially participate.

Royalty income not derived in the or- dinary course of a trade or business re- ported on Schedule E in most cases is not considered income from a passive activity.

For more details on passive activities, see the Instructions for Form 8582 and Pub. 925.

Exception for Certain Rental Real Estate Activities If you meet all of the following condi- tions, your rental real estate losses are not limited by the passive activity loss rules. If you do not meet all of these conditions, see the Instructions for Form 8582 to find out if you must complete and attach Form 8582 to figure any los- ses allowed.

1. Rental real estate activities are your only passive activities.

2. You do not have any prior year unallowed losses from any passive ac- tivities.

3. All of the following apply if you have an overall net loss from these ac- tivities:

a. You actively participated (defined later) in all of the rental real estate activ- ities;

b. If married filing separately, you lived apart from your spouse all year;

c. Your overall net loss from these activities is $25,000 or less ($12,500 or less if married filing separately);

d. You have no current or prior year unallowed credits from passive activi- ties; and

e. Your modified adjusted gross in- come (defined later) is $100,000 or less ($50,000 or less if married filing sepa- rately).

Active participation. You can meet the active participation requirement without regular, continuous, and substantial in- volvement in real estate activities. But you must have participated in making management decisions or arranging for others to provide services (such as re- pairs) in a significant and bona fide sense. Such management decisions in- clude:

Approving new tenants, Deciding on rental terms,

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Approving capital or repair expen- ditures, and

Other similar decisions. You are not considered to actively

participate if, at any time during the tax year, your interest (including your spou- se's interest) in the activity was less than 10% by value of all interests in the ac- tivity. If you are a limited partner, you are also not treated as actively partici- pating in a partnership's rental real estate activities. Modified adjusted gross income. This is your adjusted gross income from Form 1040, line 38, or Form 1040NR, line 37, without taking into account:

Any allowable passive activity loss,

Rental real estate losses allowed for real estate professionals (see Activi­ ties of real estate professionals, earlier),

Taxable social security or tier 1 railroad retirement benefits,

Deductible contributions to a tradi- tional IRA or certain other qualified re- tirement plans under section 219,

The student loan interest deduc- tion,

The tuition and fees deduction, The domestic production activities

deduction, The deduction for a portion of

self-employment tax, The exclusion from income of in-

terest from series EE and I U.S. savings bonds used to pay higher education ex- penses, and

Any excluded amounts under an employer's adoption assistance program.

Recordkeeping You must keep records to support items reported on Schedule E in case the IRS has questions about them. If the IRS ex- amines your tax return, you may be asked to explain the items reported. Good records will help you explain any item and arrive at the correct tax with a minimum of effort. If you do not have records, you may have to spend time getting statements and receipts from var- ious sources. If you cannot produce the correct documents, you may have to pay additional tax and be subject to penal- ties.

Specific Instructions Filers of Form 1041. If you are a fidu- ciary filing Schedule E with Form 1041, enter the estate's or trust's employer identification number (EIN) in the space for “Your social security number.”

Part I Before you begin, see Line 3 and Line 4, later, to deter­ mine if you should report your rental real estate and

royalty income on Schedule C, Sched­ ule C­EZ, or Form 4835, instead of Schedule E.

Line A If you made any payments in 2012 that would require you to file any Forms 1099, check the “Yes” box. Otherwise, check the “No” box. See the 2012 Gen- eral Instructions for Certain Information Returns if you are unsure whether you were required to file any Forms 1099. Also see the separate instructions for each Form 1099.

Generally, you must file Form 1099­MISC if you paid at least $600 in rents, serv­ ices, prizes, medical and

health care payments, and other income payments. The Guide to Information Re- turns in the 2012 General Instructions for Certain Information Returns has more information, including the due dates for the various information re­ turns.

Income or Loss From Rental Real Estate and Royalties Use Part I to report the following.

Income and expenses from rental real estate (including personal property leased with real estate).

Royalty income and expenses. For an estate or trust only, farm

rental income and expenses based on crops or livestock produced by the ten- ant. Estates and trusts do not use Form 4835 or Schedule F (Form 1040) for this purpose.

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If you own a part interest in a rental real estate property, report only your part of the income and expenses on Schedule E.

Complete lines 1 and 2 for each rent- al real estate property. For royalty prop- erties, line 2 and the address portion on line 1 should be left blank and you should enter code “6” for royalty proper- ty.

If you have more than three rental re- al estate or royalty properties, complete and attach as many Schedules E as you need to list them. But answer lines A and B and fill in lines 23a through 26 on only one Schedule E. The figures on lines 23a through 26 on that Schedule E should be the combined totals for all properties reported on your Schedules E. If you are also using page 2 of Sched- ule E, use the same Schedule E on which you entered the combined totals for Part I. Personal property. Do not use Sched- ule E to report income and expenses from the rental of personal property, such as equipment or vehicles. Instead, use Schedule C or C-EZ if you are in the business of renting personal property. You are in the business of renting per- sonal property if the primary purpose for renting the property is income or profit and you are involved in the rental activi- ty with continuity and regularity.

If your rental of personal property is not a business, see the instructions for Form 1040, lines 21 and 36, to find out how to report the income and expenses. Extraterritorial income exclusion. Except as otherwise provided in the In- ternal Revenue Code, gross income in- cludes all income from whatever source derived. Gross income, however, does not include extraterritorial income that is qualifying foreign trade income under certain circumstances. Use Form 8873 to figure the extraterritorial income exclu- sion. Report it on Schedule E as ex- plained in the Instructions for Form 8873. Chapter 11 bankruptcy cases. If you were a debtor in a chapter 11 bankruptcy case, see Chapter 11 Bankruptcy Cases under Income in the Instructions for Form 1040.

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Line 1a For rental real estate property only, show the street address, city or town, state, and ZIP code. If the property is lo- cated in a foreign country, enter the city, province or state, country, and postal code.

Line 1b For the type of property, enter one of the codes listed under “Type of Property” in Part I of the form. Self-rental. Enter code type “7” for self-rental if you rent property to a trade or business in which you materially par- ticipated. See Rental of Property to a Nonpassive Activity in Pub. 925 for de- tails about the tax treatment of income from this type of rental property. Other. Enter code type “8” if the prop- erty is not one of the other types listed on the form. Attach a statement to your return describing the property.

Line 2 If you rented out a dwelling unit that you also used for personal purposes dur- ing the year, you may not be able to de- duct all the expenses for the rental part. “Dwelling unit” (unit) means a house, apartment, condominium, or similar property.

For each property listed on line 1a, report the number of days in the year each property was rented at fair rental value and the number of days of person- al use.

A day of personal use is any day, or part of a day, that the unit was used by:

You for personal purposes, Any other person for personal pur-

poses, if that person owns part of the unit (unless rented to that person under a “shared equity” financing agreement),

Anyone in your family (or in the family of someone else who owns part of the unit), unless the unit is rented at a fair rental price to that person as his or her main home,

Anyone who pays less than a fair rental price for the unit, or

Anyone under an agreement that lets you use some other unit.

Do not count as personal use: Any day you spent working sub-

stantially full time repairing and main- taining the unit, even if family members

used it for recreational purposes on that day, or

Any days you used the unit as your main home before or after renting it or offering it for rent, if you rented or tried to rent it for at least 12 consecutive months (or for a period of less than 12 consecutive months at the end of which you sold or exchanged it).

Whether or not you can deduct ex- penses for the unit depends on whether or not you used the property as a home in 2012. You used the property as a home if your personal use of the proper- ty was more than the greater of:

14 days, or 10% of the total days it was rented

to others at a fair rental price.

If you did not use the property as a home, you can deduct all your expenses for the rental part, subject to the At­Risk Rules and the Passive Activity Loss Rules explained earlier.

If you did use the property as a home and rented the unit out for fewer than 15 days in 2012, do not report the rental in- come and do not deduct any rental ex- penses. If you itemize deductions on Schedule A, you can deduct allowable interest, taxes, and casualty losses.

If you did use the property as a home and rented the unit out for at least 15 days in 2012, you may not be able to de- duct all your rental expenses. You can deduct all the following expenses for the rental part on Schedule E.

Mortgage interest. Real estate taxes. Casualty losses. Other rental expenses not related to

your use of the unit as a home, such as advertising expenses and rental agents' fees.

If any income is left after deducting these expenses, you can deduct other ex- penses, including depreciation, up to the amount of remaining income. You can carry over to 2013 the amounts you can- not deduct.

Regardless of whether you used the unit as a home, ex­ penses related to days of per­ sonal use do not qualify as

rental expenses. You must allocate your expenses based on the number of days of personal use to total use of the property. For example, you used your property for

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personal use for 7 days and rented it for 63 days. In most cases, 10% (7÷70) of your expenses are not rental expenses and cannot be deducted on Schedule E.

See Pub. 527 for details. QJV. Check the box for “QJV” if you owned the property as a member of a qualified joint venture reporting income not subject to self-employment tax. See Husband­Wife Qualified Joint Venture, earlier.

Line 3 If you received rental income from real estate (including personal property leased with real estate), report the in- come on line 3. Use a separate column (A, B, or C) for each rental property. In- clude income received for renting a room or other space.

If you received services or property instead of money as rent, report the fair market value of what you received as rental income on line 3.

If you provided significant services to the renter, such as maid service, report the rental activity on Schedule C or C-EZ, not on Schedule E. Significant services do not include the furnishing of heat and light, cleaning of public areas, trash collection, or similar services.

If you were a real estate dealer, in- clude only the rent received from real estate (including personal property leased with this real estate) you held for the primary purpose of renting to pro- duce income. Do not use Schedule E to report income and expenses from rentals of real estate you held for sale to cus- tomers in the ordinary course of your business as a real estate dealer. Instead use Schedule C or C-EZ for those rent- als.

For more details on rental income, use TeleTax topic 414 ( see What is Tel­ eTax? in the Instructions for Form 1040), or see Pub. 527. Rental income from farm production or crop shares. Report farm rental in- come and expenses on Form 4835 if:

You are an individual, You received rental income based

on crops or livestock produced by the tenant, and

You did not materially participate in the management or operation of the farm.

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Line 4 Report on line 4 royalties from oil, gas, or mineral properties (not including op- erating interests); copyrights; and pat- ents. Use a separate column (A, B, or C) for each royalty property.

If you received $10 or more in royal- ties during 2012, the payer should send you a Form 1099-MISC or similar state- ment by January 31, 2013, showing the amount you received. Report this amount on line 4.

If you are in business as a self-em- ployed writer, inventor, artist, etc., re- port your royalty income and expenses on Schedule C.

You may be able to treat amounts re- ceived as “royalties” for the transfer of a patent or amounts received on the dis- posal of coal and iron ore as the sale of a capital asset. For details, see Pub. 544.

Enter on line 4 the gross amount of rent and royalty income, even if state or local taxes were withheld from oil or gas payments you received. Include taxes withheld by the producer on line 16.

General Instructions for Lines 5 Through 21 Enter your rental and royalty expenses for each property in the appropriate col- umn. You can deduct all ordinary and necessary expenses, such as taxes, inter- est, repairs, insurance, management fees, agents' commissions, and depreciation.

Do not deduct the value of your own labor or amounts paid for capital invest- ments or capital improvements.

Enter your total expenses for mort- gage interest (line 12), depreciation ex- penses and depletion (line 18), and total expenses (line 20) on lines 23c through 23e, respectively, even if you have only one property. Renting out part of your home. If you rent out only part of your home or other property, deduct the part of your expen- ses that applies to the rented part. Credit or deduction for access expen- ditures. You may be able to claim a tax credit for eligible expenditures paid or incurred in 2012 to provide access to your business for individuals with disa- bilities. See Form 8826 for details.

You can also elect to deduct up to $15,000 of qualified costs paid or incur-

red in 2012 to remove architectural or transportation barriers to individuals with disabilities and the elderly.

You cannot take both the credit and the deduction for the same expenditures.

Line 6 You can deduct ordinary and necessary auto and travel expenses related to your rental activities, including 50% of meal expenses incurred while traveling away from home. In most cases you can either deduct your actual expenses or take the standard mileage rate. You must use ac- tual expenses if you used more than four vehicles simultaneously in your rental activities (as in fleet operations). You cannot use actual expenses for a leased vehicle if you previously used the stand- ard mileage rate for that vehicle.

You can use the standard mileage rate for 2012 only if you:

Owned the vehicle and used the standard mileage rate for the first year you placed the vehicle in service, or

Leased the vehicle and are using the standard mileage rate for the entire lease period (except the period, if any, before 1998).

If you take the standard mileage rate, multiply the number of miles driven in connection with your rental activities by 55.5 cents per mile. Include this amount and your parking fees and tolls on line 6.

You cannot deduct rental or lease payments, depreciation, or your actual auto expenses if you use the standard mile­

age rate.

If you deduct actual auto expenses: Include on line 6 the rental activity

portion of the cost of gasoline, oil, re- pairs, insurance, tires, license plates, etc., and

Show auto rental or lease payments on line 19 and depreciation on line 18.

If you claim any auto expenses (ac- tual or the standard mileage rate), you must complete Part V of Form 4562 and attach Form 4562 to your tax return.

See Pub. 527 and Pub. 463 for de- tails.

Line 10 Include on line 10 fees for tax advice and the preparation of tax forms related

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to your rental real estate or royalty prop- erties.

Do not deduct legal fees paid or in- curred to defend or protect title to prop- erty, to recover property, or to develop or improve property. Instead, you must capitalize these fees and add them to the property's basis.

Lines 12 and 13 In most cases, to determine the interest expense allocable to your rental activi- ties, you must have records to show how the proceeds of each debt were used. Specific tracing rules apply for allocat- ing debt proceeds and repayment. See Pub. 535 for details.

If you have a mortgage on your rental property, enter on line 12 the amount of interest you paid for 2012 to banks or other financial institutions.

Do not deduct prepaid interest when you paid it. You can deduct it only in the year to which it is properly allocable. Points, including loan origination fees, charged only for the use of money must be deducted over the life of the loan.

If you paid $600 or more in interest on a mortgage during 2012, the recipient should send you a Form 1098 or similar statement by January 31, 2013, showing the total interest received from you.

If you paid more mortgage interest than is shown on your Form 1098 or similar statement, see Pub. 535 to find out if you can deduct part or all of the additional interest. If you can, enter the entire deductible amount on line 12. At- tach a statement to your return explain- ing the difference. In the space to the left of line 12, enter “See attached.”

Note. If the recipient was not a finan- cial institution or you did not receive a Form 1098 from the recipient, report your deductible mortgage interest on line 13.

If you and at least one other person (other than your spouse if you file a joint return) were liable for and paid interest on the mortgage, and the other person received Form 1098, report your share of the deductible interest on line 13. At- tach a statement to your return showing the name and address of the person who received Form 1098. On the dotted line next to line 13, enter “See attached.”

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Line 14 You can deduct the cost of repairs made to keep your property in good working condition. Repairs in most cases do not add significant value to the property or extend its life. Examples of repairs are fixing a broken lock or painting a room. Improvements that increase the value of the property or extend its life, such as replacing a roof or renovating a kitchen, must be capitalized and depreciated (that is, they cannot be deducted in full in the year they are paid or incurred). See Line 18, later.

Line 17 You can deduct the cost of ordinary and necessary telephone calls related to your rental activities or royalty income (for example, calls to the renter). However, the base rate (including taxes and other charges) for local telephone service for the first telephone line into your resi- dence is a personal expense and is not deductible.

Line 18 Depreciation is the annual deduction you must take to recover the cost or oth- er basis of business or investment prop- erty having a useful life substantially be- yond the tax year. Land is not deprecia- ble.

Depreciation starts when you first use the property in your business or for the production of income. It ends when you deduct all your depreciable cost or other basis or no longer use the property in your business or for the production of income.

See the Instructions for Form 4562 to figure the amount of depreciation to en- ter on line 18.

You must complete and attach Form 4562 only if you are claiming:

Depreciation on property first placed in service during 2012,

Depreciation on listed property (defined in the Instructions for Form 4562), including a vehicle, regardless of the date it was placed in service, or

A section 179 expense deduction or amortization of costs that began in 2012.

See Pub. 527 for more information on depreciation of residential rental proper- ty. See Pub. 946 for a more comprehen- sive guide to depreciation.

If you have an economic interest in mineral property, you may be able to take a deduction for depletion. Mineral property includes oil and gas wells, mines, and other natural deposits (in- cluding geothermal deposits). See Pub. 535 for details. Separating cost of land and buildings. If you buy buildings and your cost in- cludes the cost of the land on which they stand, you must divide the cost between the land and the buildings to figure the basis for depreciation of the buildings. The part of the cost that you allocate to each asset is the ratio of the fair market value of that asset to the fair market val- ue of the whole property at the time you buy it.

If you are not certain of the fair mar- ket values of the land and the buildings, you can divide the cost between them based on their assessed values for real estate tax purposes.

Line 19 Enter on line 19 any ordinary and neces- sary expenses not listed on lines 5 through 18.

You may be able to deduct, on line 19, part or all of the cost of modify- ing existing commercial buildings to make them energy efficient. For details, see section 179D, Notice 2006-52, No- tice 2008-40, and Notice 2012-26. You can find Notice 2006-52 on page 1175 of Internal Revenue Bulletin 2006-26 at www.irs.gov/irb/2006­26_IRB/ ar11.html. You can find Notice 2008-40 on page 725 of Internal Revenue Bulle- tin 2008-14 at www.irs.gov/irb/ 2008­14_IRB/ar12.html. You can find Notice 2012-26 on page 847 of Internal Revenue Bulletin 2012-17 at www.irs.gov/irb/2012­17_/IRB/ ar08.html.

Line 21 If you have amounts for which you are not at risk, use Form 6198 to determine the amount of your deductible loss. En- ter that amount in the appropriate col- umn of Schedule E, line 21. In the space to the left of line 21, enter “Form 6198.” Attach Form 6198 to your return. For details on the at-risk rules, see At­Risk Rules, earlier.

Line 22 Do not complete line 22 if the amount on line 21 is from royalty properties.

If you have a rental real estate loss from a passive activity (defined earlier), the amount of loss you can deduct may be limited by the passive activity loss rules. You may need to complete Form 8582 to figure the amount of loss, if any, to enter on line 22. See the Instructions for Form 8582 to determine if your loss is limited.

If your rental real estate loss is not from a passive activity or you meet the exception for certain rental real estate activities (explained earlier), you do not have to complete Form 8582. Enter the loss from line 21 on line 22.

If you have an unallowed rental real estate loss from a prior year that after completing Form 8582 you can deduct this year, include that loss on line 22.

Parts II and III If you need more space in Part II or III to list your income or losses, attach a continuation sheet using the same for- mat as shown in Part II or III. However, be sure to complete the “Totals” col- umns for lines 29a and 29b, or lines 34a and 34b, as appropriate. If you also completed Part I on more than one Schedule E, use the same Schedule E on which you entered the combined totals in Part I. Tax preference items. If you are a partner, a shareholder in an S corpora- tion, or a beneficiary of an estate or trust, you must take into account your share of preferences and adjustments from these entities for the alternative minimum tax on Form 6251 or Sched- ule I (Form 1041).

Part II Income or Loss From Partnerships and S Corporations If you are a member of a partnership or joint venture or a shareholder in an S corporation, use Part II to report your share of the partnership or S corporation income (even if not received) or loss.

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If you elected to be taxed as a qualified joint venture in­ stead of a partnership, follow the reporting rules under

Husband-Wife Qualified Joint Venture, earlier.

You should receive a Schedule K-1 from the partnership or S corporation. You should also receive a copy of the Partner's or Shareholder's Instructions for Schedule K-1. Your copy of Sched- ule K-1 and its instructions will tell you where on your return to report your share of the items. If you did not receive these instructions with your Sched- ule K-1, see the instructions for Form 1040 or Form 1040NR for how to get tax forms, instructions, and publications. Do not attach Schedules K-1 to your re- turn. Keep them for your records.

If you are treating items on your tax return differently from the way the part- nership (other than an electing large partnership) or S corporation reported them on its return, you may have to file Form 8082. If you are a partner in an electing large partnership, you must re- port the items shown on Schedule K-1 (Form 1065-B) on your tax return the same way the partnership reported the items on Schedule K-1. Special rules that limit losses. Please note the following.

If you have an interest in a partner- ship or S corporation that is involved in a farming business, your losses may be limited if the partnership accepted cer- tain subsidies. You will be notified on the K-1 if the partnership or S corpora- tion received one of these subsidies. Use Worksheet 1 on the last page of these in- structions to determine if you have an excess farm loss. See the Instructions for Schedule F for more details on how to complete the worksheet.

If you have other farming businesses requiring you to file Schedule F or any Sched­ ule C activity of processing a

farm commodity, you should use one of the worksheets in the Instructions for Schedule F instead of Worksheet 1 on the last page of these instructions.

If you have a current year loss, or a prior year unallowed loss, from a part- nership or an S corporation, see At­Risk Rules and Passive Activity Loss Rules, earlier.

CAUTION !

CAUTION !

Partners and S corporation sharehold- ers should get a separate statement of in- come, expenses, deductions, and credits for each activity engaged in by the part- nership and S corporation. If you are subject to the at-risk rules for any activi- ty, check the box on the appropriate line in Part II, column (e) of Schedule E, and use Form 6198 to figure the amount of any deductible loss. If the activity is nonpassive, enter any deductible loss from Form 6198 on the appropriate line in Part II, column (h) of Schedule E.

If you have a passive activity loss, in most cases you need to complete Form 8582 to figure the amount of the allowable loss to enter in Part II, column (f), for that activity. But if you are a general partner or an S corporation shareholder reporting your share of a partnership or an S corporation loss from a rental real estate activity and you meet all of the conditions listed earlier under Exception for Certain Rental Real Estate Activities, you do not have to complete Form 8582. Instead, enter your allowable loss in Part II, column (f).

If you have passive activity income, complete Part II, column (g), for that ac- tivity.

If you have nonpassive income or losses, complete Part II, columns (h) through (j), as appropriate.

Domestic Partnerships See the Schedule K-1 instructions before entering on your return other partnership items from a passive activity or income or loss from any publicly traded partner- ship.

You can deduct unreimbursed ordina- ry and necessary expenses you paid on behalf of the partnership if you were re- quired to pay these expenses under the partnership agreement. See Line 27, lat- er, for how to report these expenses.

Report allowable interest expense paid or incurred from debt-financed ac- quisitions in Part II or on Schedule A depending on the type of expenditure to which the interest is allocated. See Pub. 535 for details.

If you claimed a credit for federal tax on gasoline or other fuels on your 2011 Form 1040 or Form 1040NR based on information received from the partner- ship, enter as income in column (g) or column (j), whichever applies, the amount of the credit claimed for 2011.

Part or all of your share of partner- ship income or loss from the operation of the business may be considered net earnings from self-employment that must be reported on Schedule SE. Enter the amount from Schedule K-1 (Form 1065), box 14, code A (or from Sched- ule K-1 (Form 1065-B), box 9 (code J1)), on Schedule SE, after you reduce this amount by any allowable expenses attributable to that income.

Foreign Partnerships Follow the instructions below in addi- tion to the instructions earlier for Do­ mestic Partnerships.

If you are a U.S. person, you may have received Forms 1099-B, 1099-DIV, and 1099-INT reporting your share of certain partnership income, be- cause payors of income to the foreign partnership in most cases are required to allocate and report payments of that in- come directly to each of the partners of the foreign partnership. If you received both Schedule K-1 and Form 1099 for the same type and source of partnership income, report only the income shown on Schedule K-1 in accordance with its instructions.

If you are not a U.S. person, you may have received Forms 1042-S reporting your share of certain partnership in- come, because payors of income to the foreign partnership in most cases are re- quired to allocate and report payments of that income directly to each of the partners of the foreign partnership. If you received both Schedule K-1 and Form 1042-S for the same type and source of partnership income, report the income on your return as follows.

For all income effectively connec- ted with the conduct of a trade or busi- ness in the United States, report only the income shown on Schedule K-1 in ac- cordance with its instructions.

For all income not effectively con- nected with the conduct of a trade or business in the United States, report on page 4 of Form 1040NR only the in- come shown on Form 1042-S (if you are required to file Form 1040NR). Requirement to file Form 8865. If you are a U.S. person, you may have to file Form 8865 if any of the following ap- plies.

1. You controlled a foreign partner- ship (that is, you owned more than a

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50% direct or indirect interest in the partnership).

2. You owned at least a 10% direct or indirect interest in a foreign partner- ship while U.S. persons controlled that partnership.

3. You had an acquisition, disposi- tion, or change in proportional interest of a foreign partnership that:

a. Increased your direct interest to at least 10% or reduced your direct interest of at least 10% to less than 10%, or

b. Changed your direct interest by at least a 10% interest.

4. You contributed property to a for- eign partnership in exchange for a part- nership interest if:

a. Immediately after the contribu- tion, you owned, directly or indirectly, at least a 10% interest in the partnership, or

b. The value of the property you contributed, when added to the value of any other property you or any related person contributed to the partnership during the 12-month period ending on the date of transfer, exceeds $100,000.

Also, you may have to file Form 8865 to report certain dispositions by a foreign partnership of property you pre- viously contributed to that partnership if you were a partner at the time of the dis- position.

For more details, including penalties for failing to file Form 8865, see Form 8865 and its separate instructions.

S Corporations If you are a shareholder in an S corpora- tion, your share of the corporation's ag- gregate losses and deductions (combined income, losses, and deductions) is in most cases limited to the adjusted basis of your corporate stock and any debt the corporation owes you. Any loss or de- duction not allowed this year because of the basis limitation can be carried for- ward and deducted in a later year subject to the basis limitation for that year.

If you are claiming a deduction for your share of an aggregate loss, attach to your return a computation of the adjus- ted basis of your corporate stock and of any debt the corporation owes you. See the Schedule K-1 instructions for details.

After applying the basis limitation, the deductible amount of your aggregate

losses and deductions may be further re- duced by the at-risk rules and the pas- sive activity loss rules. See At­Risk Rules and Passive Activity Loss Rules earlier.

Distributions of prior year accumula- ted earnings and profits of S corpora- tions are dividends and are reported on Form 1040, line 9a.

Interest expense relating to the ac- quisition of shares in an S corporation may be fully deductible on Schedule E. For details, see Pub. 535.

Your share of the net income of an S corporation is not subject to self-em- ployment tax.

Line 27 If you answered “Yes” on line 27, fol- low the instructions below. If you fail to follow these instructions, the IRS may send you a notice of additional tax due because the amounts reported by the partnership or S corporation on Sched- ule K-1 do not match the amounts you reported on your tax return.

Losses Not Allowed in Prior Years Due to the At-Risk or Basis Limitations

Enter your total prior year unal- lowed losses that are now deductible on a separate line in column (h) of line 28. Do not combine these losses with, or net them against, any current year amounts from the partnership or S corporation.

Enter “PYA” in column (a) of the same line.

Prior Year Unallowed Losses From a Passive Activity Not Reported on Form 8582

Enter on a separate line in column (f) of line 28 your total prior year unal- lowed losses not reported on Form 8582. Such losses include prior year unal- lowed losses now deductible because you did not have an overall loss from all passive activities or you disposed of your entire interest in a passive activity in a fully taxable transaction. Do not combine these losses with, or net them against, any current year amounts from the partnership or S corporation.

Enter “PYA” in column (a) of the same line.

Unreimbursed Partnership Expenses

You can deduct unreimbursed ordi- nary and necessary partnership expenses you paid on behalf of the partnership on Schedule E if you were required to pay these expenses under the partnership agreement (except amounts deductible only as itemized deductions, which you must enter on Schedule A).

Enter unreimbursed partnership ex- penses from nonpassive activities on a separate line in column (h) of line 28. Do not combine these expenses with, or net them against, any other amounts from the partnership.

If the expenses are from a passive activity and you are not required to file Form 8582, enter the expenses related to a passive activity on a separate line in column (f) of line 28. Do not combine these expenses with, or net them against, any other amounts from the partnership.

Enter “UPE” in column (a) of the same line.

Line 28 For nonpassive income or loss (and pas- sive income or losses for which you are not filing Form 8582), enter in the appli- cable column of line 28 your current year ordinary income or loss from the partnership or S corporation. Report each related item required to be reported on Schedule E (including items of in- come or loss stated separately on Sched- ule K-1) in the applicable column of a separate line following the line on which you reported the current year ordinary income or loss. Also enter a description of the related item (for example, deple- tion) in column (a) of the same line.

If you are required to file Form 8582, see the Instructions for Form 8582 be- fore completing Schedule E.

Part III Income or Loss From Estates and Trusts If you are a beneficiary of an estate or trust, use Part III to report your part of the income (even if not received) or loss. You should receive a Schedule K-1 (Form 1041) from the fiduciary. Your copy of Schedule K-1 and its instruc- tions will tell you where on your return

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to report the items from Schedule K-1. Do not attach Schedule K-1 to your re- turn. Keep it for your records.

If you are treating items on your tax return differently from the way the es- tate or trust reported them on its return, you may have to file Form 8082.

If you have estimated taxes credited to you from a trust (Form 1041, Sched- ule K-1, box 13, code A), enter “ES pay- ment claimed” and the amount on the dotted line next to line 37. Do not in- clude this amount in the total on line 37. Instead, enter the amount on Form 1040, line 63, or Form 1040NR, line 62.

A U.S. person who transferred prop- erty to a foreign trust may have to report the income received by the trust as a re- sult of the transferred property if, during 2012, the trust had a U.S. beneficiary. See section 679. An individual who re- ceived a distribution from, or who was the grantor of or transferor to, a foreign trust must also complete Part III of Schedule B (Form 1040A or 1040) and may have to file Form 3520. In addition, the owner of a foreign trust must ensure that the trust files an annual information return on Form 3520-A.

Part IV Income or Loss From Real Estate Mortgage Investment Conduits (REMICs) If you are the holder of a residual inter- est in a REMIC, use Part IV to report

your total share of the REMIC's taxable income or loss for each quarter included in your tax year. You should receive Schedule Q (Form 1066) and instruc- tions from the REMIC for each quarter. Do not attach Schedules Q to your re- turn. Keep them for your records.

If you are treating REMIC items on your tax return differently from the way the REMIC reported them on its return, you may have to file Form 8082.

If you are the holder of a residual in- terest in more than one REMIC, attach a continuation sheet using the same for- mat as in Part IV. Enter the combined totals of columns (d) and (e) on Sched- ule E, line 39. If you also completed Part I on more than one Schedule E, use the same Schedule E on which you entered the combined totals in Part I.

REMIC income or loss is not income or loss from a passive activity.

Note. If you are the holder of a regular interest in a REMIC, do not use Sched- ule E to report the income you received. Instead, report it on Form 1040, line 8a.

Column (c). Report the total of the amounts shown on Schedule(s) Q, line 2c. This is the smallest amount you are allowed to report as your taxable in- come (Form 1040, line 43). It is also the smallest amount you are allowed to re- port as your alternative minimum taxa- ble income (AMTI) on Form 6251, line 28.

If the amount in column (c) is larger than your taxable income would other-

wise be, enter the amount from column (c) on Form 1040, line 43. Similarly, if the amount in column (c) is larger than your AMTI would otherwise be, enter the amount from column (c) on Form 6251, line 28. Enter “Sch. Q” on the dot- ted line to the left of this amount on Form 1040, line 43, and Form 6251, line 28, if applicable.

Note. These rules also apply to estates and trusts that hold a residual interest in a REMIC. Be sure to make the appropri- ate entries on the comparable lines on Form 1041.

Do not include the amount shown in column (c) in the total on Schedule E, line 39.

Column (e). Report the total of the amounts shown on Schedule(s) Q, line 3b. If you itemize your deductions, include this amount on Schedule A (Form 1040), line 23.

Part V Summary Line 42 You will not be charged a penalty for underpayment of estimated tax if:

1. Your gross farming or fishing in- come for 2011 or 2012 is at least two-thirds of your gross income, and

2. You file your 2012 tax return and pay the tax due by March 1, 2013.

CAUTION !

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Excess farm loss from an interest in a partnership or S corporation involved in farming business(es)

Worksheet 1 —

Keep for Your Records

CAUTION !

In determining if you have an excess farm loss, do not take into account any deductions for losses arising by reason of fire, storm, or other casualty, or by reason of disease or drought, involving your farm businesses.

1. Enter the amount from your 2012 Schedule(s) E, line 31. If this amount is less than $300,000 ($150,000 if married filing separately), stop here; you do not have an excess farm loss in 2012. If more than $300,000 ($150,000 if married filing separately), continue to line 2 . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. Subtract $300,000 ($150,000 if married filing separately) from line 1 . . . . . 2.

3. Enter the amount from your 2012 Schedule(s) E, line 30 . . . . . . . . . . . . . . . . 3.

4. Is line 3 greater than or equal to line 2? If yes, stop here; you do not have an excess farm loss in 2012. If no, continue to line 5 . . . . . . . . . . . . . . . . . . . . . .

5. Enter your net gain/loss from the sale of farming business property reported on Form 4797 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.

6. Enter your net gain/loss from the sale of farming business property reported on Schedule D . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.

7. Combine line 5 and line 6. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . 7.

8. Add line 3 and line 7. Is this greater than or equal to line 2? If yes, stop here; you do not have an excess farm loss in 2012. If no, continue to line 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.

9. Enter the amount from your 2011 Schedule(s) E, line 32 . . . . . . . . . . . . . . . . 9.

10. Enter your combined net gain/loss from the sale of farming business property reported on your 2011 Form 4797 and Schedule D. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.

11. Enter the amount from your 2010 Schedule(s) E, line 32 . . . . . . . . . . . . . . . . 11.

12. Enter your combined net gain/loss from the sale of farming business property reported on your 2010 Form 4797 and Schedule D. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.

13. Enter the amount from your 2009 Schedule(s) E, line 32 . . . . . . . . . . . . . . . . 13.

14. Enter your combined net gain/loss from the sale of farming business property reported on your 2009 Form 4797 and Schedule D. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.

15. Enter the amount from your 2008 Schedule(s) E, line 32 . . . . . . . . . . . . . . . . 15.

16. Enter your combined net gain/loss from the sale of farming business property reported on your 2008 Form 4797 and Schedule D. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.

17. Enter the amount from your 2007 Schedule(s) E, line 32 . . . . . . . . . . . . . . . . 17.

18. Enter your combined net gain/loss from the sale of farming business property reported on your 2007 Form 4797 and Schedule D. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.

19. Combine lines 9 through 18. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . 19.

20. Enter the greater of line 19 or $300,000 ($150,000 if married filing separately) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.

21. Add line 8 and line 20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21.

22. Excess farm loss. Subtract line 1 from line 21. If zero or less, you have an excess farm loss that reduces the amount of loss you can deduct this year. If you have more than one farming business with an overall loss this year, allocate the excess farm loss amount on a pro rata basis among those farming businesses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22.

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Department of the Treasury Internal Revenue Service

2012 Instructions for Schedule F Profit or Loss From Farming

Use Schedule F (Form 1040) to report farm income and expenses. File it with Form 1040, 1040NR, 1041, 1065, or 1065-B.

Your farming activity may subject you to state and local taxes and other require- ments such as business licenses and fees. Check with your state and local governments for more information. Additional information. Pub. 225 has more information and examples to help you complete your farm tax return. It also lists important dates that apply to farmers.

Section references are to the Internal Revenue Code unless otherwise noted.

Future Developments For the latest information about developments related to Sched- ule F (Form 1040) and its instructions, such as legislation enac- ted after they were published, go to www.irs.gov/form1040.

What's New No separate payment card reporting requirements. Gross receipts received via payment card (credit and debit cards) and third party network payments are not separately reported on Schedule F. Standard mileage rate. The standard mileage rate for busi- ness use of your vehicle for 2012 is 55.5 cents per mile. Heavy highway vehicle use tax. This tax has been extended through September 30, 2017.

General Instructions Other Schedules and Forms You May Have To File

Schedule E (Form 1040), Part I, to report rental income from pastureland based on a flat charge. However, report on Schedule F (Form 1040), line 8, pasture income received from taking care of someone else's livestock. Also use Schedule E (Form 1040), Part I, to report farm rental income and expenses of a trust or estate based on crops or livestock produced by a tenant.

Schedule J (Form 1040) to figure your tax by averaging your farm income over the previous 3 years. Doing so may reduce your tax.

Schedule SE (Form 1040) to pay self-employment tax on income from your farming business.

Form 3800 to claim any general business credits. Form 4562 to claim depreciation (including the special

allowance) on assets placed in service in 2012, to claim amortization that began in 2012, to make an election under section 179 to expense certain property, or to report information on vehicles and other listed property.

Form 4684 to report a casualty or theft gain or loss involving farm business property, including purchased livestock held for draft, breeding, sport, or dairy purposes. See Pub. 225 for more information on how to report various farm losses, such as losses due to death of livestock or damage to crops or other farm property.

Form 4797 to report sales, exchanges, or involuntary conversions (other than from a casualty or theft) of certain farm property. Also use this form to report sales of livestock held for draft, breeding, sport, or dairy purposes.

Form 4835 to report rental income based on crop or livestock shares produced by a tenant if you did not materially participate in the management or operation of a farm. This income is not subject to self-employment tax. See Pub. 225.

Form 6198 to figure your allowable loss if you have a business loss and you have amounts invested in the business for which you are not at risk.

Form 8582 to figure your allowable loss from passive activities.

Form 8824 to report like-kind exchanges. Form 8903 to take a deduction for income from domestic

production activities. Single-member limited liability company (LLC). Generally, a single-member domestic LLC is not treated as a separate enti- ty for federal income tax purposes. If you are the sole member of a domestic LLC engaged in the business of farming, file Schedule F (Form 1040). However, you can elect to treat a do- mestic LLC as a corporation. See Form 8832 for details on the election. Heavy highway vehicle use tax. If you use certain highway trucks, truck-trailers, tractor trailers, or buses in your farming business, you may have to pay a federal highway motor vehicle use tax. See the Instructions for Form 2290 to find out if you owe this tax and go to www.irs.gov/trucker for the latest devel- opments. Information returns. You may have to file information re- turns for wages paid to employees, certain payments of fees and other nonemployee compensation, interest, rents, royalties, real estate transactions, annuities, and pensions. For details, see Line F, later, and the 2012 General Instructions for Certain In- formation Returns.

If you received cash of more than $10,000 in one or more related transactions in your farming business, you may have to file Form 8300. For details, see Pub. 1544.

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Reportable transaction disclosure statement. If you entered into a reportable transaction in 2012, you must file Form 8886 to disclose information if your federal income tax liability is af- fected by your participation in the transaction. You may have to pay a penalty if you are required to file Form 8886 but do not do so. You may also have to pay interest and penalties on any reportable transaction understatements. For more informa- tion on reportable transactions, see the Instructions for Form 8886.

Husband-Wife Farm If you and your spouse jointly own and operate a farm as an unincorporated business and share in the profits and losses, you can be taxed as a partnership and file Form 1065, or you each can file Schedule F (Form 1040) as a qualified joint venture.

Qualified Joint Venture If you and your spouse each materially participate as the only members of a jointly owned and operated farm, and you file a joint return for the tax year, you can elect to be treated as a qualified joint venture instead of a partnership. This election in most cases will not increase the total tax owed on the joint re- turn, but it does give each of you credit for social security earn- ings on which retirement benefits are based and for Medicare coverage without filing a partnership return. For an explanation of “material participation,” see the instructions for Schedule C (Form 1040), line G, and Line E, later, in these instructions. Making the election. To make this election, you must divide all items of income, gain, loss, deduction, and credit attributa- ble to the farming business between you and your spouse in ac- cordance with your respective interests in the venture. Each of you must file a separate Schedule F (Form 1040). On each line of your separate Schedule F (Form 1040), you must enter your share of the applicable income, deduction, or loss. Each of you must also file a separate Schedule SE (Form 1040) to pay self-employment tax, as applicable.

As long as you remain qualified, your election cannot be re- voked without IRS consent.

For more information on qualified joint ventures, go to IRS.gov. Enter “qualified joint venture” in the search box and select “Election for Husband and Wife Unincorporated Busi- nesses.”

Exception—Community Income If you and your spouse wholly own an unincorporated farming business as community property under the community property laws of a state, foreign country, or U.S. possession, the income and deductions are reported as follows.

If only one spouse participates in the business, all of the income from that business is the self-employment earnings of the spouse who carried on the business.

If both spouses participate, the income and deductions are allocated to the spouses based on their distributive shares.

If either or both you and your spouse are partners in a partnership, see Pub. 541.

If you and your spouse elected to treat the business as a qualifying joint venture, see Qualified Joint Venture, earlier, for how to report income and deductions.

The only states with community property laws are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. A change in your reporting posi- tion will be treated as a conversion of the entity.

Estimated Tax If you had to make estimated tax payments for 2012, and you underpaid your estimated tax, you will not be charged a penalty if both of the following apply.

Your gross farming or fishing income for 2011 or 2012 is at least two-thirds of your gross income, and

You file your 2012 tax return and pay the tax due by March 1, 2013.

For details, see chapter 15 of Pub. 225.

Specific Instructions Filers of Forms 1041, 1065, and 1065-B. Do not complete the block labeled “Social security number (SSN).” Instead, en- ter the employer identification number (EIN) issued to the es- tate, trust, or partnership on line D.

Line B On line B, enter one of the 14 principal agricultural activity co- des listed in Part IV on page 2 of Schedule F (Form 1040). Se- lect the code that best describes the source of most of your in- come.

Line C If you use the cash method, check the box for “Cash.” Com- plete Schedule F (Form 1040), Parts I and II. In most cases, re- port income in the year in which you actually or constructively received it and deduct expenses in the year you paid them. However, if the payment of an expenditure creates an asset having a useful life that extends substantially beyond the close of the year, it may not be deductible or may be deductible only in part for the year of the payment. See chapter 2 of Pub. 225.

If you use an accrual method, check the box for “Accrual.” Complete Schedule F (Form 1040), Parts II, III, and Part I, line 9. Generally, report income in the year in which you earned it and deduct expenses in the year you incurred them, even if you did not pay them in that year. Accrual basis taxpay- ers are put on a cash basis for deducting business expenses ow- ed to a related cash-basis taxpayer. Other rules determine the timing of deductions based on economic performance. See Pub. 538. Farming syndicates. Farming syndicates cannot use the cash method of accounting. A farming syndicate may be a partner- ship, LLC, S corporation, or any other enterprise other than a C corporation if:

The interests in the business have at any time been offered for sale in a way that would require registration with any feder- al or state agency, or

More than 35% of the loss during any tax year is shared by limited partners or limited entrepreneurs. A limited partner is one who can lose only the amount invested or required to be

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invested in the partnership. A limited entrepreneur is a person who does not take any active part in managing the business.

Line D Enter on line D the employer identification number (EIN) that was issued to you on Form SS-4. Do not enter your SSN. Do not enter another taxpayer's EIN (for example, from any Forms 1099-MISC that you received.) If you do not have an EIN, leave line D blank.

You need an EIN only if you have a qualified retirement plan or are required to file employment, excise, alcohol, tobac- co, or firearms returns, or if you are a payer of gambling win- nings. If you need an EIN, see the Instructions for Form SS-4. Single-member LLCs. If you are a sole owner of an LLC that is not treated as a separate entity for federal income tax purpo- ses, you may have an EIN that was issued to the LLC (and in the LLC's legal name) if you are required to file employment tax returns and certain excise tax returns. However, you should enter on line D only the EIN issued to you and in your name as the sole proprietor of your farming business. If you do not have such an EIN, leave line D blank. Do not enter on line D the EIN issued to the LLC. Single-member limited liability companies (LLCs) with em- ployees. Single-member LLCs that are disregarded as entities separate from their owner for federal tax purposes are required to file employment tax returns using the LLC's name and em- ployer identification number (EIN) rather than the LLC own- er's name and EIN. Single-member LLCs not previously need- ing an EIN may need to obtain an EIN for the payment and reporting of these taxes. For more information, see the Instruc- tions for Form SS-4. Filers of Forms 1041, 1065, and 1065-B. Enter on line D the EIN issued to the estate, trust, or partnership.

Line E Material participation. For the definition of material partici- pation for purposes of the passive activity rules, see the instruc- tions for Schedule C (Form 1040), line G. If you meet any of the material participation tests described in those instructions, check the “Yes” box.

If you are a retired or disabled farmer, you are treated as materially participating in a farming business if you materially participated 5 or more of the 8 years preceding your retirement or disability. Also, a surviving spouse is treated as materially participating in a farming activity if he or she actively manages the farm and the real property used for farming meets the estate tax rules for special valuation of farm property passed from a qualifying decedent.

Check the “No” box if you did not materially participate. If you checked “No” and you have a loss from this business, see Limit on passive losses next. If you have a profit from this business activity but have current year losses from other pas- sive activities or prior year unallowed passive activity losses, see the Instructions for Form 8582. Limit on passive losses. If you checked the “No” box and you have a loss from this business, you may have to use Form 8582

to figure your allowable loss, if any, to enter on Schedule F (Form 1040), line 34. In most cases, you can deduct losses from passive activities only to the extent of income from pas- sive activities. For details, see Pub. 925.

Line F If you made any payments in 2012 that would require you to file any Forms 1099, check the “Yes” box. Otherwise, check the “No” box. See the 2012 General Instructions for Certain In- formation Returns if you are unsure whether you are required to file any Forms 1099. Also see the separate specific instruc- tions for each Form 1099.

Generally, you must file Form 1099-MISC if you paid at least $600 in rents, services, prizes, medical and health care payments, and other income pay- ments. The Guide to Information Returns in the

2012 General Instructions for Certain Information Returns has more information, including the due dates for the various infor- mation returns.

Part I. Farm Income—Cash Method In Part I, show income received for items listed on lines 1 through 8. In most cases, include both the cash actually or con- structively received and the fair market value of goods or other property received for these items. Income is constructively re- ceived when it is credited to your account or set aside for you to use. However, direct payments or counter-cyclical payments received under the Food, Conservation, and Energy Act of 2008 are required to be included in income only in the year of actual receipt.

If you ran the farm yourself and received rents based on crop shares or farm production, report these rents as income on line 2. Sales of livestock because of weather-related conditions. If you sold livestock because of drought, flood, or other weath- er-related conditions, you can elect to report the income from the sale in the year after the year of sale if all of the following apply.

Your main business is farming. You can show that you sold the livestock only because of

weather-related conditions. Your area qualified for federal aid.

See chapter 3 of Pub. 225 for details. Chapter 11 bankruptcy. If you were a debtor in a chapter 11 bankruptcy case during 2012, see Chapter 11 Bankruptcy Ca- ses under Income in the Instructions for Form 1040 and the In- structions for Schedule SE (Form 1040). Forms 1099 or CCC-1099-G. If you received Forms 1099 or CCC-1099-G showing amounts paid to you, first determine if the amounts are to be included with farm income. Then use the following chart to determine where to report the income on Schedule F (Form 1040). Include the Form 1099 or CCC-1099-G amounts in the total amount reported on that line.

TIP

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Form Where to

report 1099-PATR . . . . . . . . . . . . . . . . . . . . . . Line 3a 1099-A . . . . . . . . . . . . . . . . . . . . . . . . . Line 5b 1099-MISC for crop insurance . . . . . . . . . . Line 6a 1099-G or CCC-1099-G

for disaster payments . . . . . . . . . . . . Line 6a for other agricultural

program payments . . . . . . . . . . . . . . Line 4a

You may receive Form 1099-MISC for other types of in- come. In this case, report it on whichever line best describes the income. For example, if you receive a Form 1099-MISC for custom farming work, include this amount on line 7.

Lines 3a and 3b If you received distributions from a cooperative in 2012, you should receive a Form 1099-PATR. On line 3a, show your total distributions from cooperatives. This includes patronage divi- dends, nonpatronage distributions, per-unit retain allocations, and redemptions of nonqualified written notices of allocation and per-unit retain certificates.

Show patronage dividends received in cash and the dollar amount of qualified written notices of allocation. If you re- ceived property as patronage dividends, report the fair market value of the property as income. Include cash advances re- ceived from a marketing cooperative. If you received per-unit retains in cash, show the amount of cash. If you received quali- fied per-unit retain certificates, show the stated dollar amount of the certificates.

Do not include as income on line 3b patronage dividends from buying personal or family items, capital assets, or depre- ciable assets. Enter these amounts on line 3a only. Because you do not report patronage dividends from these items as income, you must subtract the amount of the dividend from the cost or other basis of these items.

Lines 4a and 4b Enter on line 4a the total of the following amounts.

Direct payments. Counter-cyclical payments. Price support payments. Market gain from the repayment of a secured Commodity

Credit Corporation (CCC) loan for less than the original loan amount.

Diversion payments. Cost-share payments (sight drafts). Payments in the form of materials (such as fertilizer or

lime) or services (such as grading or building dams).

These amounts are government payments you received and are usually reported to you on Form 1099-G. You may also receive Form CCC-1099-G from the Department of Agriculture show- ing the amounts and types of payments made to you.

On line 4b, report only the taxable amount. For example, do not report the market gain shown on Form CCC-1099-G on

line 4b if you elected to report CCC loan proceeds as income in the year received (see Lines 5a Through 5c next). No gain re- sults from redemption of the commodity because you previous- ly reported the CCC loan proceeds as income. You are treated as repurchasing the commodity for the amount of the loan re- payment. However, if you did not report the CCC loan pro- ceeds under the election, you must report the market gain on line 4b.

If you received a direct or counter-cyclical payment in 2012, your farm losses may be reduced. See Excess farm loss rules, later, for more details.

Lines 5a Through 5c Commodity Credit Corporation (CCC) loans. In most ca- ses, you do not report CCC loan proceeds as income. However, if you pledge part or all of your production to secure a CCC loan, you can elect to report the loan proceeds as income in the year you receive them. If you make this election (or made the election in a prior year), report loan proceeds you received in 2012 on line 5a. Attach a statement to your return showing the details of the loan(s). See chapter 3 of Pub. 225. Forfeited CCC loans. Include the full amount forfeited on line 5b, even if you reported the loan proceeds as income. This amount may be reported to you on Form 1099-A.

If you did not elect to report the loan proceeds as income, also include the forfeited amount on line 5c.

If you did elect to report the loan proceeds as income, you generally will not have an entry on line 5c. But if the amount forfeited is different from your basis in the commodity, you may have an entry on line 5c.

See chapter 3 of Pub. 225 for details on the tax consequen- ces of electing to report CCC loan proceeds as income or for- feiting CCC loans.

If you received a CCC loan in 2012, your farm losses may be reduced. See Excess farm loss rules, later, for more details.

Lines 6a Through 6d In most cases, you must report crop insurance proceeds in the year you receive them. Federal crop disaster payments are trea- ted as crop insurance proceeds. However, if 2012 was the year of damage, you can elect to include certain proceeds in income for 2013. To make this election, check the box on line 6c and attach a statement to your return. See chapter 3 of Pub. 225 for a description of the proceeds for which an election can be made and for what you must include in your statement.

In most cases, if you elect to defer any eligible crop insur- ance proceeds, you must defer all such crop insurance proceeds (including federal crop disaster payments).

Enter on line 6a the total crop insurance proceeds you re- ceived in 2012, even if you elect to include them in income for 2013.

Enter on line 6b the taxable amount of the proceeds you re- ceived in 2012. Do not include proceeds you elect to include in income for 2013.

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Enter on line 6d the amount, if any, of crop insurance pro- ceeds you received in 2011 and elected to include in income for 2012.

Line 8 Enter on line 8 income not otherwise reportable on lines 1 through 7. This includes the following types of income.

Illegal federal irrigation subsidies. See chapter 3 of Pub. 225.

Bartering income. Income from cancellation of debt. In most cases, if a debt

is canceled or forgiven, you must include the canceled amount in income. If a federal agency, financial institution, or credit union canceled or forgave a debt you owed of $600 or more, it should send you a Form 1099-C, or similar statement, by Janu- ary 31, 2013, showing the amount of debt canceled in 2012. However, you may be able to exclude the canceled debt from income. See Pub. 4681 for details.

State gasoline or fuel tax refunds you received in 2012. The amount of credit claimed on Form 6478 or Form

8864. The amount of credit for federal tax paid on fuels claimed

on your 2011 Form 1040. For information on including the credit in income, see chapter 2 of Pub. 510.

Any recapture of excess depreciation on any listed proper- ty, including any section 179 expense deduction, if the business use percentage of that property decreased to 50% or less in 2012. Use Part IV of Form 4797 to figure the recapture. See the instructions for Schedule C (Form 1040), line 13, for the defi- nition of listed property.

The inclusion amount on leased listed property (other than vehicles) when the business use percentage drops to 50% or less. See chapter 5 of Pub. 946 to figure the amount.

Any recapture of the deduction or credit for clean-fuel ve- hicle refueling property or alternative fuel vehicle refueling property used in your farming business. For details on how to figure recapture, see Regulations section 1.179A-1.

Any income from breeding fees, or fees from renting teams, machinery, or land.

The gain or loss on the sale of commodity futures con- tracts if the contracts were made to protect you from price changes. These are a form of business insurance and are con- sidered hedges. If you had a loss in a closed futures contract, enclose the amount of the loss in parentheses.

For property acquired and hedging positions estab- lished, you must clearly identify on your books and records both the hedging transaction and the item(s) or aggregate risk being hedged.

Purchase or sales contracts are not true hedges if they offset losses that already occurred. If you bought or sold commodity futures with the hope of making a profit due to favorable price changes, report the profit or loss on Form 6781 instead of this line.

Part II. Farm Expenses Do not deduct the following.

CAUTION !

Personal or living expenses (such as taxes, insurance, or repairs on your home) that do not produce farm income.

Expenses of raising anything you or your family used. The value of animals you raised that died. Inventory losses. Personal losses.

If you were repaid for any part of an expense, you must sub- tract the amount you were repaid from the deduction.

Capitalizing costs of property. If you produced real or tangi- ble personal property or acquired property for resale, certain expenses must be included in inventory costs or capitalized. These expenses include the direct costs of the property and the share of any indirect costs allocable to that property. However, these rules generally do not apply to expenses of:

1. Producing any plant that has a preproductive period of 2 years or less,

2. Raising animals, or 3. Replanting certain crops if they were lost or damaged by

reason of freezing temperatures, disease, drought, pests, or casualty.

Exceptions (1) and (2) do not apply to tax shelters, farming syndicates, partnerships, or corporations required to use the accrual method of accounting under section 447 or 448(a)(3).

If you capitalize your expenses, do not reduce your deduc- tions on lines 10 through 32e by the capitalized expenses. In- stead, enter the total amount capitalized in parentheses on line 32f (to indicate a negative amount) and enter “263A” in the space to the left of the total. See Preproductive period ex- penses, later, for details.

But you may be able to currently deduct rather than capital- ize the expenses of producing a plant with a preproductive peri- od of more than 2 years. See Election to deduct certain prepro- ductive period expenses next.

Election to deduct certain preproductive period expenses. If the preproductive period of any plant you produce is more than 2 years, you can elect to currently deduct the expenses rather than capitalize them. But you cannot make this election for the costs of planting or growing citrus or almond groves in- curred before the end of the fourth tax year beginning with the tax year you planted them in their permanent grove. You are treated as having made the election by deducting the prepro- ductive period expenses in the first tax year for which you can make this election and by applying the special rules, discussed later.

In the case of a partnership or S corporation, the election must be made by the partner, shareholder, or member. This election cannot be made by tax shelters, farming syndicates, partnerships, or cor-

porations required to use the accrual method of accounting un- der section 447 or 448(a)(3).

Unless you obtain IRS consent, you must make this election for the first tax year in which you engage in a farming business involving the production of property subject to the capitaliza-

CAUTION !

CAUTION !

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tion rules. You cannot revoke this election without IRS con- sent.

Special rules. If you make the election to deduct prepro- ductive expenses for plants:

Any gain you realize when disposing of the plants is ordi- nary income up to the amount of the preproductive expenses you deducted, and

The alternative depreciation rules apply to property placed in service in any tax year your election is in effect.

For details, see Uniform Capitalization Rules in chapter 6 of Pub. 225.

Prepaid farm supplies. In most cases, if you use the cash method of accounting and your prepaid farm supplies are more than 50% of your other deductible farm expenses, your deduc- tion for those supplies may be limited. Prepaid farm supplies include expenses for feed, seed, fertilizer, and similar farm sup- plies not used or consumed during the year.

They also include the cost of poultry that would be allowa- ble as a deduction in a later tax year if you were to:

1. Capitalize the cost of poultry bought for use in your farming business and deduct it ratably over the lesser of 12 months or the useful life of the poultry, and

2. Deduct the cost of poultry bought for resale in the year you sell or otherwise dispose of it.

If the limit applies, you can deduct prepaid farm supplies that do not exceed 50% of your other deductible farm expenses in the year of payment. You can deduct the excess only in the year you use or consume the supplies (other than poultry, which is deductible as explained above). For details and excep- tions to these rules, see chapter 4 of Pub. 225.

Whether or not this 50% limit applies, your expenses for livestock feed paid during the year but consumed in a later year may be subject to the rules explained in the line 16 instructions.

Line 10 You can deduct the actual expenses of operating your car or truck or take the standard mileage rate. You must use actual ex- penses if you used five or more vehicles simultaneously in your farming business (such as in fleet operations). You cannot use actual expenses for a leased vehicle if you previously used the standard mileage rate for that vehicle.

You can take the standard mileage rate for 2012 only if you: Owned the vehicle and used the standard mileage rate for

the first year you placed the vehicle in service, or Leased the vehicle and are using the standard mileage rate

for the entire lease period.

If you take the standard mileage rate: Multiply the number of business miles driven by 55.5

cents, and Add to this amount your parking fees and tolls, and enter

the total on line 10.

Do not deduct depreciation, rent or lease payments, or your actual operating expenses.

If you deduct actual expenses:

Include on line 10 the business portion of expenses for gasoline, oil, repairs, insurance, license plates, etc., and

Show depreciation on line 14 and rent or lease payments on line 24a.

If you claim any car or truck expenses (actual or the stand- ard mileage rate), you must provide the information requested on Form 4562, Part V. Be sure to attach Form 4562 to your re- turn.

For details, see chapter 4 of Pub. 463.

Line 12 Deductible conservation expenses generally are those that are paid to conserve soil and water for land used in farming, to pre- vent erosion of land used for farming, or for endangered spe- cies recovery. These expenses include (but are not limited to) costs for the following.

The treatment or movement of earth, such as leveling, grading, conditioning, terracing, contour furrowing, and the re- storation of soil fertility.

The construction, control, and protection of diversion channels, drainage ditches, irrigation ditches, earthen dams, watercourses, outlets, and ponds.

The eradication of brush. The planting of windbreaks. The achievement of site-specific management actions rec-

ommended in recovery plans approved pursuant to the Endan- gered Species Act of 1973.

These expenses can be deducted only if they are consistent with a conservation plan approved by the Natural Resources Conservation Service of the Department of Agriculture or a re- covery plan approved pursuant to the Endangered Species Act of 1973, for the area in which your land is located. If no plan exists, the expenses must be consistent with a plan of a compa- rable state agency. You cannot deduct the expenses if they were paid or incurred for land used in farming in a foreign country.

Do not deduct expenses you paid or incurred to drain or fill wetlands, or to prepare land for center pivot irrigation systems.

Your deduction cannot exceed 25% of your gross income from farming (excluding certain gains from selling assets such as farm machinery and land). If your conservation expenses are more than the limit, the excess can be carried forward and de- ducted in later tax years. However, the amount deductible for any one year cannot exceed the 25% gross income limit for that year.

For details, see chapter 5 of Pub. 225.

Line 13 Enter amounts paid for custom hire or machine work (the ma- chine operator furnished the equipment).

Do not include amounts paid for rental or lease of equip- ment you operated yourself. Instead, report those amounts on line 24a.

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Line 14 You can deduct depreciation of buildings, improvements, cars and trucks, machinery, and other farm equipment of a perma- nent nature.

Do not deduct depreciation on your home, furniture or other personal items, land, livestock you bought or raised for resale, or other property in your inventory.

You can also elect under section 179 to expense a portion of the cost of certain property you bought in 2012 for use in your farming business. The section 179 election is made on Form 4562.

For information about depreciation and the section 179 de- duction, see Pub. 946 and chapter 7 of Pub. 225. For details on the special depreciation allowance, see chapter 3 of Pub. 946.

See the Instructions for Form 4562 for information on when you must complete and attach Form 4562.

Line 15 Deduct contributions to employee benefit programs that are not an incidental part of a pension or profit-sharing plan included on line 23. Examples are accident and health plans, group-term life insurance, and dependent care assistance programs. If you made contributions on your behalf as a self-employed person to a dependent care assistance program, complete Form 2441, Parts I and III, to figure your deductible contributions to that program.

Contributions you made on your behalf as a self-employed person to an accident and health plan or for group-term life in- surance are not deductible on Schedule F (Form 1040). Howev- er, you may be able to deduct on Form 1040, line 29 (or on Form 1040NR, line 29), the amount you paid for health insur- ance on behalf of yourself, your spouse, and dependent(s) even if you do not itemize your deductions. See the instructions for Form 1040, line 29, or Form 1040NR, line 29, for details.

You must reduce your line 15 deduction by the amount of any credit for small employer health insurance premiums deter- mined on Form 8941. See Form 8941 and its instructions to de- termine which expenses are eligible for the credit.

Line 16 If you use the cash method, you cannot deduct when paid the cost of feed your livestock will consume in a later year unless all of the following apply.

The payment was for the purchase of feed rather than a deposit.

The prepayment had a business purpose and was not made merely to avoid tax.

Deducting the prepayment will not materially distort your income.

If all of the above apply, you can deduct the prepaid feed when paid, subject to the overall limit for Prepaid farm sup- plies explained earlier. If all of the above do not apply, you can deduct the prepaid feed only in the year it is consumed.

Line 18 Do not include the cost of transportation incurred in purchasing livestock held for resale as freight paid. Instead, add these costs to the cost of the livestock.

Line 20 Deduct on this line premiums paid for farm business insurance. Deduct on line 15 amounts paid for employee accident and health insurance. Amounts credited to a reserve for self-insur- ance or premiums paid for a policy that pays for your lost earn- ings due to sickness or disability are not deductible. For details, see chapter 6 of Pub. 535.

Lines 21a and 21b Interest allocation rules. The tax treatment of interest ex- pense differs depending on its type. For example, home mort- gage interest and investment interest are treated differently. “Interest allocation” rules require you to allocate (classify) your interest expense so it is deducted (or capitalized) on the correct line of your return and receives the right tax treatment. These rules could affect how much interest you are allowed to deduct on Schedule F (Form 1040).

In most cases, you allocate interest expense by tracing how the proceeds of the loan are used. See chapter 4 of Pub. 535 for details.

If you paid interest on a debt secured by your main home and any of the proceeds from that debt were used in your farm- ing business, see chapter 4 of Pub. 535 to figure the amount to include on lines 21a and 21b. How to report. If you have a mortgage on real property used in your farming business (other than your main home), enter on line 21a the interest you paid for 2012 to banks or other finan- cial institutions for which you received a Form 1098 (or similar statement). If you did not receive a Form 1098, enter the inter- est on line 21b.

If you paid more mortgage interest than is shown on Form 1098, see chapter 4 of Pub. 535 to find out if you can deduct the additional interest. If you can, include the amount on line 21a. Attach a statement to your return explaining the dif- ference and enter “See attached” in the margin next to line 21a.

If you and at least one other person (other than your spouse if you file a joint return) were liable for and paid interest on the mortgage and the other person received the Form 1098, include your share of the interest on line 21b. Attach a statement to your return showing the name and address of the person who received the Form 1098. In the margin next to line 21b, enter “See attached.”

Do not deduct interest you prepaid in 2012 for later years; include only the part that applies to 2012.

Line 22 Enter the amounts you paid for farm labor. Do not include amounts paid to yourself. Reduce your deduction by the amounts claimed on:

Form 5884, Work Opportunity Credit;

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Form 8844, Empowerment Zone Employment Credit; Form 8845, Indian Employment Credit; and Form 8932, Credit for Employer Differential Wage Pay-

ments.

Include the cost of boarding farm labor but not the value of any products they used from the farm. Include only what you paid household help to care for farm laborers.

If you provided taxable fringe benefits to your em- ployees, such as personal use of a car, do not in- clude in farm labor the amounts you depreciated or deducted elsewhere.

Line 23 Enter your deduction for contributions to employee pension, profit-sharing, or annuity plans. If the plan included you as a self-employed person, enter contributions made as an employer on your behalf on Form 1040, line 28 (or on Form 1040NR, line 28), not on Schedule F (Form 1040).

In most cases, you must file the applicable form listed next if you maintain a pension, profit-sharing, or other funded-de- ferred compensation plan. The filing requirement is not affec- ted by whether or not the plan qualified under the Internal Rev- enue Code, or whether or not you claim a deduction for the current tax year. There is a penalty for failure to timely file these forms. Form 5500-EZ. File this form if you have a one-participant retirement plan that meets certain requirements. A one-partici- pant plan is a plan that covers only you (or you and your spouse). Form 5500-SF. File this form if you have a small plan (fewer than 100 participants in most cases) that meets certain require- ments. Form 5500. File this form for a plan that does not meet the re- quirements for filing Form 5500-EZ or Form 5500-SF.

For details, see Pub. 560.

Lines 24a and 24b If you rented or leased vehicles, machinery, or equipment, en- ter on line 24a the business portion of your rental cost. But if you leased a vehicle for a term of 30 days or more, you may have to reduce your deduction by an inclusion amount. See Leasing a Car in chapter 4 of Pub. 463 to figure this amount.

Enter on line 24b amounts paid to rent or lease other proper- ty such as pasture or farmland.

Line 25 Enter amounts you paid for incidental repairs and maintenance of farm buildings, machinery, and equipment that do not add to the property's value or appreciably prolong its life.

Do not deduct repairs or maintenance on your home.

Line 29 You can deduct the following taxes on this line.

CAUTION !

Real estate and personal property taxes on farm business assets.

Social security and Medicare taxes you paid to match what you are required to withhold from farm employees' wages without consideration for the temporary employee payroll tax cut for 2012.

Federal unemployment tax. Federal highway use tax. Contributions to state unemployment insurance fund or

disability benefit fund if they are considered taxes under state law.

Do not deduct the following taxes on this line. Federal income taxes, including your self-employment

tax. However, you can deduct your employer-equivalent por- tion of self-employment tax on Form 1040, line 27 or Form 1040NR, line 27.

Estate and gift taxes. Taxes assessed for improvements, such as paving and

sewers. Taxes on your home or personal use property. State and local sales taxes on property purchased for use

in your farming business. Instead, treat these taxes as part of the cost of the property.

Other taxes not related to your farming business.

Line 30 Enter amounts you paid for gas, electricity, water, and other utilities for business use on the farm. Do not include personal utilities. You cannot deduct the base rate (including taxes) of the first telephone line into your residence, even if you use it for your farming business. But you can deduct expenses you paid for your farming business that are more than the cost of the base rate for the first phone line. For example, if you had a second phone line, you can deduct the business percentage of the charges for that line, including the base rate charges.

Lines 32a Through 32f Include all ordinary and necessary farm expenses not deducted elsewhere on Schedule F (Form 1040), such as advertising, of- fice supplies, etc. Do not include fines or penalties paid to a government for violating any law.

At-risk loss deduction. Any loss from this activity that was not allowed last year because of the at-risk rules is treated as a deduction allocable to this activity in 2012.

Bad debts. See chapter 10 of Pub. 535.

Business start-up costs. If your farming business began in 2012, you can elect to deduct up to $5,000 of certain business start-up costs paid or incurred after October 22, 2004. The $5,000 limit is reduced (but not below zero) by the amount by which your start-up costs exceed $50,000. Your remaining start-up costs can be amortized over a 180-month period, be- ginning with the month the farming business began. For de- tails, see chapters 4 and 7 of Pub. 225. For amortization that begins in 2012, you must complete and attach Form 4562.

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Business use of your home. You may be able to deduct cer- tain expenses for business use of your home, subject to limita- tions. Use the worksheet in Pub. 587 to figure your allowable deduction. Do not use Form 8829.

Excess farm loss deduction. Any loss from this activity that was not allowed last year because of the excess farm loss rules is treated as a deduction allocable to this activity in 2012.

Forestation and reforestation costs. Reforestation costs are generally capital expenditures. However, for each qualified timber property, you can elect to expense up to $10,000 ($5,000 if married filing separately) of qualifying reforestation costs paid or incurred in 2012.

You can elect to amortize the remaining costs over 84 months. For amortization that begins in 2012, you must com- plete and attach Form 4562.

The amortization election does not apply to trusts, and the expense election does not apply to estates and trusts. For de- tails on reforestation expenses, see chapters 4 and 7 of Pub. 225.

Legal and professional fees. You can include on this line fees charged by accountants and attorneys that are ordinary and necessary expenses directly related to your farming business. Include fees for tax advice and for the preparation of tax forms related to your farming business. Also include expenses incur- red in resolving asserted tax deficiencies related to your farm- ing business. Tools. You can deduct the amount you paid for tools that have a short life or cost a small amount, such as shovels and rakes.

Travel, meals, and entertainment. In most cases, you can de- duct expenses for farm business travel and 50% of your busi- ness meals and entertainment. But there are exceptions and limitations. See the instructions for Schedule C (Form 1040), lines 24a and 24b.

Preproductive period expenses. If you had preproductive pe- riod expenses in 2012 that you are capitalizing, enter the total of these expenses in parentheses on line 32f (to indicate a nega- tive amount) and enter “263A” in the space to the left of the to- tal.

For details, see Capitalizing costs of property, earlier, and Uniform Capitalization Rules in chapter 6 of Pub. 225.

Line 33 If line 32f is a negative amount, subtract it from the total of lines 10 through 32e. Enter the result on line 33.

Line 34 Figuring your net profit or allowable loss. If line 33 is more than line 9, do not enter your loss on line 34 until you have ap- plied the excess farm loss rules, the at-risk rules, and the pas- sive activity loss rules. To apply these rules, follow the instruc- tions for lines 35 and 36, and the Instructions for Form 8582. After applying these rules, the amount on line 34 will be your allowable loss, and it may be smaller than the amount figured by subtracting line 33 from line 9.

If line 9 is more than line 33, and you do not have prior year unallowed passive activity losses, subtract line 33 from line 9. The result is your net profit.

If line 9 is more than line 33, and you have prior year unal- lowed passive activity losses, do not enter your net profit on line 34 until you have figured the amount of prior year unal- lowed passive activity losses you may claim this year for this activity. Use Form 8582 to figure the amount of prior year un- allowed passive activity losses you may include on line 34. Make sure to indicate that you are including prior year passive activity losses by entering "PAL" to the left of the entry space.

If you checked the "No" box on line E, see the Instructions for Form 8582; you may need to include information from this schedule on that form, even if you have a net profit.

Partnerships. Subtract line 33 from line 9. If the amount is a loss, the partners may need to apply the excess farm loss rules, the at-risk rules, and the passive activity loss rules to de- termine the amount of their allowable loss. Reporting your net profit or allowable loss. Once you have figured your net profit or allowable loss, report it as follows.

Individuals. Enter your net profit or allowable loss here and on Form 1040, line 18, and Schedule SE (Form 1040), line 1a.

Nonresident aliens. Enter the net profit or allowable loss here and on Form 1040NR, line 19. You should also enter this amount on Schedule SE (Form 1040), line 1a if you are cov- ered under the U.S. social security system due to an interna- tional social security agreement currently in effect. See the Schedule SE (Form 1040) instructions for information on inter- national social security agreements.

Partnerships. Enter the net profit or loss here and on Form 1065, line 5 (or Form 1065-B, line 7). Because the excess farm loss rules are applied at the partner level, the partnership will notify each partner on the Schedule K-1 if the partnership re- ceived one of the subsidies discussed later. Each partner should complete one of the excess farm loss worksheets to determine if there is an excess farm loss.

Trusts and estates. Enter the net profit or allowable loss here and on Form 1041, line 6. Community income. If you and your spouse had community income and are filing separate returns, see the Instructions for Schedule SE (Form 1040) before figuring self-employment tax. Earned income credit. If you have a net profit on line 34, this amount is earned income and may qualify you for the earned income credit if you meet certain conditions. See the instruc- tions for Form 1040, lines 64a and 64b, for details. Conservation Reserve Program (CRP) payments. If you re- ceived social security retirement or disability benefits in addi- tion to CRP payments, the CRP payments are not subject to self-employment tax. You will deduct these payments from your net farm profit or loss on Schedule SE (Form 1040), line 1b. Do not make any adjustment on Schedule F (Form 1040).

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Line 35 Line 35 should be answered with respect to your farming busi- ness (defined later), and not just for the farming activities re- ported on this Schedule F. You may also have reported farming activities on another Schedule F or on Form 4835.

Check the “Yes” box if you received one of the following subsidies in 2012.

Any direct or counter-cyclical payments under title I of the Food, Conservation, and Energy Act of 2008 (or any pay- ment you elected instead of this payment).

Any Commodity Credit Corporation loan. You are considered to have received one of these subsidies in 2012 if you are a partner or shareholder in a partnership or S corporation that received one of these subsidies during 2012. Check the "No" box if you did not receive one of these subsi- dies in 2012.

If you checked the “Yes” box, your farm loss may be re- duced. You must apply the excess farm loss rules, discussed next.

If you checked the "No" box, you do not have excess farm loss.

Excess farm loss rules. If you received one of the subsidies listed above, part of your loss may be excess farm loss. Excess farm loss is not an allowable loss. Instead, excess farm loss is carried forward to the next year and treated as a deduction.

Your excess farm loss for a year is the amount by which your total deductions from your farming businesses exceed your total gross income or gain from your farming businesses, plus a threshold amount. The threshold amount is the greater of $300,000 ($150,000 if your filing status is married filing sepa- rately) or your total net profit or loss from farming businesses for the last five years (2007-2011), including for each of those years any net gain from the sale of property used in your farm- ing businesses.

Farming business defined. A farming business generally is the trade or business of farming, including operating a nurs- ery or sod farm or raising or harvesting of trees bearing fruit, nuts, or other crops, or ornamental trees, such as evergreen trees, if they are cut within the first 6 years.

For purposes of calculating your excess farm loss for the year, a farm business also includes the following.

A trade or business of processing a farm commodity, even if it is not incidental to your farm.

Participating in a cooperative that processes a farm com- modity.

Any interest in a partnership or S corporation involved in a farming business. Figuring your excess farm loss. To figure your excess farm loss, you can use one of the excess farm loss worksheets, later. You may need to adjust your income or deductions before fig- uring your excess farm loss.

If you file multiple copies of Schedule F (Form 1040), Schedule C (Form 1040), or Schedule E (Form 1040) as part of

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your farming businesses, you must combine the income, deduc- tions, and net gain/loss for purposes of determining whether you have an excess farm loss on the worksheets. If you sold any property used in your farming businesses, you must in- clude any gain or loss on the sale of that property (reported on Form 4797, Sales of Business Property, or Schedule D (Form 1040), Capital Gains and Losses). Be sure to include the gain or loss attributable to property used in your farming businesses (defined earlier). Do not include gain or loss attributable to property used in nonfarming businesses or nonbusiness proper- ty.

Activities reported on other forms. Because your farming business includes any trade or business of processing a farm commodity that is not incidental to your farm, you may have farming business activities that are reported on Schedule C (Form 1040) that you must also include when figuring your ex- cess farm loss. Any losses from a farming business activity re- ported on Schedule C (Form 1040) may be limited by the ex- cess farm loss rules.

Because your farming business includes your interest in a partnership or S corporation, you may have farming business activities that are reported on Schedule E (Form 1040) that you must also include when figuring your excess farm loss. Any losses from a farming business activity reported on Schedule E (Form 1040) may be limited by the excess farm loss rules.

Other deductions that must be included. Certain deduc- tions, including the domestic production activities deduction under section 199 and the deduction for the employer-equiva- lent portion of self-employment tax, may need to be included when determining your excess farm loss if the deductions are attributable to your farming business (defined earlier).

In particular, the deduction for the employer-equivalent por- tion of self-employment tax will not be attributable to your farming business on Schedule F (Form 1040) or your business of processing a farm commodity on Schedule C (Form 1040) if the combined amounts on those schedules produce a loss. But the deduction for the employer-equivalent portion of self-em- ployment tax should be taken into account when the combined amounts on those schedules produce income (or the farm op- tional method on Schedule SE (Form 1040) is used) and there is a large loss on Schedule E (Form 1040) passed through from a partnership or S corporation.

Deductions that are not included. Any deduction for losses arising from fire, storm, or other casualty, or from disease or drought involving any farming business should not be included when determining your excess farm loss.

Coordination with at-risk and passive activity loss rules. You must calculate and apply your excess farm loss before cal- culating any limits due to the at-risk rules or the passive activi- ty loss rules.

Excess farm loss worksheets. You may complete one of these worksheets to determine if you have an excess farm loss in 2012. Do not attach these worksheets to your return; keep them for your records. You will need them next year when any excess farm loss may be deducted. Which worksheet you should use depends on the nature and extent of your farming business.

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Use Worksheet 1 if your farming businesses include only profit or loss reported on one or more Schedules F (Form 1040).

Use Worksheet 2 if your farming businesses include Schedule F (Form 1040) and any Schedule C (Form 1040) ac- tivity of processing a farm commodity.

Use Worksheet 3 if your farming businesses include Schedule F (Form 1040) and a Schedule E (Form 1040) interest in a partnership or S corporation involved in a farming busi- ness.

Use Worksheet 4 if your farming businesses include Schedule F (Form 1040), Schedule C (Form 1040) activity of processing a farm commodity, a Schedule E (Form 1040) inter- est in a partnership or S corporation involved in a farming busi- ness, and farm rental income or loss reported on Form 4835.

Use Worksheet 5 if your farming business is limited to only farm rental income or loss reported on Form 4835. Applying your excess farm loss. You must reduce your loss by the amount of your excess farm loss. Subtract line 33 from line 9 and reduce the number by your excess farm loss. Com- plete line 36 before entering an amount on line 34.

Example. Subtracting line 33 from line 9 results in ($400,000). You have only one farming business and use Worksheet 1 to figure an excess farm loss of ($100,000). Your allowable loss is reduced to ($300,000). This will be the amount you enter on line 34 unless the at-risk or passive activi- ty loss rules reduce it further.

Any loss from this activity not allowed for 2012 because of the excess farm loss rules is treated as a deduction allocable to the activity in 2013.

At-risk and passive activity loss rules. Use your loss re- duced by the excess farm loss to calculate any further limita- tions due to the at-risk rules or passive activity loss rules.

More than one farming business. If you have more than one farming business with a loss this year, allocate the excess farm loss amount on a pro rata basis among those farming busi- nesses. If you have more than one farming business, but only one has a loss, allocate all of the excess farm loss to the farm- ing business with the loss. Do not allocate excess farm loss to a farming business that has a net profit.

Line 36 You do not need to complete line 36 if line 9 is more than line 33.

At-risk rules. In most cases, if you have a loss from a farming activity and amounts invested in the activity for which you are not at risk, you must complete Form 6198 to figure your allow- able loss. The at-risk rules generally limit the amount of loss (including loss on the disposition of assets) you can claim to the amount you could actually lose in the activity.

Check box 36b if you have amounts invested in this activity for which you are not at risk, such as the following.

Nonrecourse loans used to finance the activity, to acquire property used in the activity, or to acquire the activity that are

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not secured by your own property (other than property used in the activity). However, there is an exception for certain nonre- course financing borrowed by you in connection with holding real property.

Cash, property, or borrowed amounts used in the activity (or contributed to the activity, or used to acquire the activity) that are protected against loss by a guarantee, stop-loss agree- ment, or other similar arrangement (excluding casualty insur- ance and insurance against tort liability).

Amounts borrowed for use in the activity from a person who has an interest in the activity, other than as a creditor, or who is related under section 465(b)(3)(C) to a person (other than you) having such an interest. Figuring your allowable loss. Before determining your al- lowable loss, you must check box 36a or 36b to determine if your loss from farming is limited by the at-risk rules. Follow the instructions below that apply to your box 36 activity.

If all your investment amounts are at risk in this activity, check box 36a. If you also checked the “Yes” box on Sched- ule F (Form 1040), line E, your remaining loss (after applying the excess farm loss rules) is your allowable loss. The at-risk rules and the passive activity loss rules do not apply. See Line 34, earlier, for how to report your allowable loss.

But if you checked the “No” box on Schedule F (Form 1040), line E, you may need to complete Form 8582 to figure your allowable loss to enter on line 34. See the Instructions for Form 8582.

If some investment is not at risk, check box 36b; the at-risk rules apply to your loss.

If you also checked the “Yes” box on Schedule F (Form 1040), line E, complete Form 6198 to determine the amount of your allowable loss. The passive activity loss rules do not ap- ply. See Line 34, earlier, for how to report your allowable loss.

But if you checked the “No” box on Schedule F (Form 1040), line E, the passive activity loss rules may apply. First complete Form 6198 to figure the amount of your loss that is at-risk. If your at-risk amount is zero or less, enter -0- on line 34; then see Line 34, earlier, for where to report this amount. If your at-risk amount is more than zero, see the In- structions for Form 8582 to determine your passive activity loss limitation and the amount of your loss that will be allowed on line 34. Be sure to attach Form 6198 to your return.

If you checked box 36b because some investment is not at risk and you do not attach Form 6198, the processing of your return may be delayed.

Any loss from this activity not allowed for 2012 only be- cause of the at-risk rules is treated as a deduction allocable to the activity in 2013.

For details, see Pub. 925 and the Instructions for Form 6198.

CAUTION !

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Part III. Farm Income—Accrual Method You may be required to use the accrual accounting method. If you use the accrual method, report farm income when you earn it, not when you receive it. In most cases, you must include an- imals and crops in your inventory if you use this method. See Pub. 225 for exceptions, inventory methods, how to change methods of accounting, and rules that require certain costs to be capitalized or included in inventory. For information about accounting periods, see Pub. 538, Accounting Periods and Methods.

Chapter 11 bankruptcy. If you were a debtor in a chapter 11 bankruptcy case during 2012, see Chapter 11 Bankruptcy Ca- ses under Income in the Instructions for Form 1040 and the In- structions for Schedule SE (Form 1040).

Lines 38a Through 40c See the instructions for lines 3a through 5c.

Line 43 See Line 8, earlier.

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Excess Farm Loss Worksheet 1—Schedule F (Form 1040) farming business only Keep for Your Records CAUTION: In determining if you have an excess farm loss, do not take into account any deductions for losses arising by reason of fire, storm, or other casualty, or by reason of disease or drought, involving your farming business.

1. Enter the amount from your 2012 Schedule(s) F (Form 1040), line 33. Is this amount less than $300,000 ($150,000 if married filing separately)? If yes, stop here. You do not have an excess farm loss in 2012. If no, continue to line 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. Subtract $300,000 ($150,000 if married filing separately) from line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.

3. Enter the amount from your 2012 Schedule(s) F (Form 1040), line 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.

4. Is line 3 greater than or equal to line 2? If yes, stop here. You do not have an excess farm loss in 2012. If no, continue to line 5.

5. Enter your net gain/loss from the sale of farming business property reported on Form 4797 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.

6. Enter your net gain/loss from the sale of farming business property reported on Schedule D (Form 1040) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.

7. Combine line 5 and line 6. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. 8. Add line 3 and line 7. Is this greater than or equal to line 2? If yes, stop here. You do not have an excess farm loss

in 2012. If no, continue to line 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8. 9. Enter the amount from your 2011 Schedule(s) F (Form 1040),

line 34 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9. 10. Enter your combined net gain/loss from the sale of farming business

property reported on your 2011 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.

11. Enter the amount from your 2010 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.

12. Enter your combined net gain/loss from the sale of farming business property reported on your 2010 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.

13. Enter the amount from your 2009 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.

14. Enter your combined net gain/loss from the sale of farming business property reported on your 2009 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.

15. Enter the amount from your 2008 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.

16. Enter your combined net gain/loss from the sale of farming business property reported on your 2008 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.

17. Enter the amount from your 2007 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.

18. Enter your combined net gain/loss from the sale of farming business property reported on your 2007 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.

19. Combine lines 9 through 18. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19. 20. Enter the greater of line 19 or $300,000 ($150,000 if married filing separately) . . . . . . . . . . . . . . . . . . . . . . . . 20. 21. Add line 8 and line 20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21. 22. Excess farm loss. Subtract line 1 from line 21. If zero or less, you have an excess farm loss that reduces the

amount of loss you can deduct this year. If you have more than one farming business with an overall loss this year, allocate the excess farm loss amount on a pro rata basis among those farming businesses . . . . . . . . . . . . . . . . . 22.

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Excess Farm Loss Worksheet 2—Schedule F (Form 1040) farming businesses and Schedule C (Form 1040) activity of processing a farm commodity Keep for Your Records CAUTION: In determining if you have an excess farm loss, do not take into account any deductions for losses arising by reason of fire, storm, or other casualty, or by reason of disease or drought, involving your farming businesses.

1. Enter the amount from your 2012 Schedule(s) F (Form 1040), line 33 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. Enter the total amount from your 2012 Schedule(s) C (Form 1040), line 28 and line 30 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.

3. Add lines 1 and 2. Is this amount less than $300,000 ($150,000 if married filing separately)? If yes, stop here. You do not have an excess farm loss in 2012. If no, continue to line 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.

4. Subtract $300,000 ($150,000 if married filing separately) from line 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.

5. Enter the amount from your 2012 Schedule(s) F (Form 1040), line 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.

6. Enter the amount from your 2012 Schedule(s) C (Form 1040), line 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.

7. Combine line 5 and line 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.

8. Is line 7 greater than or equal to line 4? If yes, stop here. You do not have an excess farm loss in 2012. If no, continue to line 9.

9. Enter your net gain/loss from the sale of farming business property reported on Form 4797 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.

10. Enter your net gain/loss from the sale of farming business property reported on Schedule D (Form 1040) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.

11. Combine line 9 and line 10. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.

12. Add line 7 and line 11. Is this greater than or equal to line 4? If yes, stop here. You do not have an excess farm loss in 2012. If no, continue to line 13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.

13. Enter the amount from your 2011 Schedule(s) F (Form 1040), line 34 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.

14. Enter the amount from your 2011 Schedule(s) C (Form 1040), line 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.

15. Enter your combined net gain/loss from the sale of farming business property reported on your 2011 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.

16. Enter the amount from your 2010 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.

17. Enter the amount from your 2010 Schedule(s) C (Form 1040), line 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.

18. Enter your combined net gain/loss from the sale of farming business property reported on your 2010 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.

19. Enter the amount from your 2009 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19.

20. Enter the amount from your 2009 Schedule(s) C (Form 1040), line 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.

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Excess Farm Loss Worksheet 2 (Continued) 21. Enter your combined net gain/loss from the sale of farming business

property reported on your 2009 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21.

22. Enter the amount from your 2008 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22.

23. Enter the amount from your 2008 Schedule(s) C (Form 1040), line 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23.

24. Enter your combined net gain/loss from the sale of farming business property reported on your 2008 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24.

25. Enter the amount from your 2007 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25.

26. Enter the amount from your 2007 Schedule(s) C (Form 1040), line 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26.

27. Enter your combined net gain/loss from the sale of farming business property reported on your 2007 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27.

28. Combine lines 13 through 27. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28.

29. Enter the greater of line 28 or $300,000 ($150,000 if married filing separately) . . . . . . . . . . . . . . . . . . . . . . . 29.

30. Add lines 12 and 29 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30.

31. Excess farm loss. Subtract line 3 from line 30. If zero or less, you have an excess farm loss that reduces the amount of loss you can deduct this year. If you have more than one farming business with an overall loss this year, allocate the excess farm loss amount on a pro rata basis among those farming businesses . . . . . . . . . . . . . . . . 31.

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Excess Farm Loss Worksheet 3—Schedule F (Form 1040) farming businesses and Schedule E (Form 1040) partnership or S corporation income or loss from farming businesses Keep for Your Records CAUTION: In determining if you have an excess farm loss, do not take into account any deductions for losses arising by reason of fire, storm, or other casualty, or by reason of disease or drought, involving your farming businesses.

1. Enter the amount from your 2012 Schedule(s) F (Form 1040), line 33 . . . . . 1.

2. Enter the amount from your 2012 Schedule(s) E (Form 1040), line 31 . . . . . 2.

3. Add lines 1 and 2. Is this amount less than $300,000 ($150,000 if married filing separately)? If yes, stop here. You do not have an excess farm loss in 2012. If no, continue to line 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.

4. Subtract $300,000 ($150,000 if married filing separately) from line 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.

5. Enter the amount from your 2012 Schedule(s) F (Form 1040), line 9 . . . . . . 5.

6. Enter the amount from your 2012 Schedule(s) E (Form 1040), line 30 . . . . . 6.

7. Combine line 5 and line 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.

8. Is line 7 greater than or equal to line 4? If yes, stop here. You do not have an excess farm loss in 2012. If no, continue to line 9.

9. Enter your net gain/loss from the sale of farming business property reported on Form 4797 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.

10. Enter your net gain/loss from the sale of farming business property reported on Schedule D (Form 1040) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.

11. Combine line 9 and line 10. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.

12. Add line 7 and line 11. Is this greater than or equal to line 4? If yes, stop here. You do not have an excess farm loss in 2012. If no, continue to line 13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.

13. Enter the amount from your 2011 Schedule(s) F (Form 1040), line 34 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.

14. Enter the amount from your 2011 Schedule(s) E (Form 1040), line 32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.

15. Enter your combined net gain/loss from the sale of farming business property reported on your 2011 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.

16. Enter the amount from your 2010 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.

17. Enter the amount from your 2010 Schedule(s) E (Form 1040), line 32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.

18. Enter your combined net gain/loss from the sale of farming business property reported on your 2010 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.

19. Enter the amount from your 2009 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19.

20. Enter the amount from your 2009 Schedule(s) E (Form 1040), line 32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.

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Excess Farm Loss Worksheet 3 (Continued) 21. Enter your combined net gain/loss from the sale of farming business property

reported on your 2009 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21.

22. Enter the amount from your 2008 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22.

23. Enter the amount from your 2008 Schedule(s) E (Form 1040), line 32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23.

24. Enter your combined net gain/loss from the sale of farming business property reported on your 2008 Form 4797 and Schedule D (Form (1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24.

25. Enter the amount from your 2007 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25.

26. Enter the amount from your 2007 Schedule(s) E (Form 1040), line 32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26.

27. Enter your combined net gain/loss from the sale of farming business property reported on your 2007 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27.

28. Combine lines 13 through 27. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28.

29. Enter the greater of line 28 or $300,000 ($150,000 if married filing separately) . . . . . . . . . . . . . . . . . . . . . . 29.

30. Add lines 12 and 29 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30.

31. Excess farm loss. Subtract line 3 from line 30. If zero or less, you have an excess farm loss that reduces the amount of loss you can deduct this year. If you have more than one farming business with an overall loss this year, allocate the excess farm loss amount on a pro rata basis among those farming businesses . . . . . . . . . . . 31.

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Excess Farm Loss Worksheet 4—Schedule F (Form 1040) farming businesses, Schedule C (Form 1040) activity of processing a farm commodity, Schedule E (Form 1040) partnership or S corporation income or loss from farming businesses, and Form 4835 rental income or loss Keep for Your Records CAUTION: In determining if you have an excess farm loss, do not take into account any deductions for losses arising by reason of fire, storm, or other casualty, or by reason of disease or drought, involving your farming businesses.

1. Enter the amount from your 2012 Schedule(s) F (Form 1040), line 33 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. Enter the total amount from your 2012 Schedule(s) C (Form 1040), line 28 and line 30, for activity of processing a farm commodity . . . . . . . . . . . . 2.

3. Enter the amount from your 2012 Schedule(s) E (Form 1040), line 31, for interest in a partnership or S corporation involved in farming businesses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.

4. Enter the amount from your 2012 Form 4835, line 31 . . . . . . . . . . . . . . 4. 5. Add lines 1, 2, 3, and 4. Is this amount less than $300,000 ($150,000 if married filing separately)? If yes, stop

here. You do not have an excess farm loss in 2012. If no, continue to line 6 . . . . . . . . . . . . . . . . . . . . . . . . . 5. 6. Subtract $300,000 ($150,000 if married filing separately) from line 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6. 7. Enter the amount from your 2012 Schedule(s) F (Form 1040),

line 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. 8. Enter the amount from your 2012 Schedule(s) C (Form 1040),

line 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8. 9. Enter the amount from your 2012 Schedule(s) E (Form 1040),

line 30 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9. 10. Enter the amount from your 2012 Form 4835, line 7 . . . . . . . . . . . . . . . 10. 11. Combine lines 7, 8, 9, and 10 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11. 12. Is line 11 greater than or equal to line 6? If yes, stop here. You do not have an excess farm loss in 2012. If no,

continue to line 13. 13. Enter your net gain/loss from the sale of farming business property reported

on Form 4797 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13. 14. Enter your net gain/loss from the sale of farming business property reported

on Schedule D (Form 1040) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14. 15. Combine line 13 and line 14. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15. 16. Add lines 11 and 15. Is this greater than or equal to line 6? If yes, stop here. You do not have an excess farm loss

in 2012. If no, continue to line 17 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16. TIP: Lines 17 through 43 help you calculate the threshold amount discussed in the instructions. The threshold amount is the greater of $300,000 ($150,000 if married filing separately) or your total net profit or loss from farming businesses for the last five years (2007-2011), including for each of those years any net gain from the sale of property used in your farming businesses.

17. Enter the amount from your 2011 Schedule(s) F (Form 1040), line 34 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.

18. Enter the amount from your 2011 Schedule(s) C (Form 1040), line 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.

19. Enter the amount from your 2011 Schedule(s) E (Form 1040), line 32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19.

20. Enter the amount from your 2011 Form 4835, line 32 . . . . . . . . . . . . . . 20. 21. Enter your combined net gain/loss from the sale of farming business

property reported on your 2011 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21.

22. Enter the amount from your 2010 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22.

23. Enter the amount from your 2010 Schedule(s) C (Form 1040), line 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23.

24. Enter the amount from your 2010 Schedule(s) E (Form 1040), line 32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24.

25. Enter the amount from your 2010 Form 4835, line 32 . . . . . . . . . . . . . . 25. 26. Enter your combined net gain/loss from the sale of farming business

property reported on your 2010 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26.

27. Enter the amount from your 2009 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27.

28. Enter the amount from your 2009 Schedule(s) C (Form 1040), line 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28.

(Continued on next page)

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Excess Farm Loss Worksheet 4 (Continued) 29. Enter the amount from your 2009 Schedule(s) E (Form 1040),

line 32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29.

30. Enter the amount from your 2009 Form 4835, line 32 . . . . . . . . . . . . . . 30.

31. Enter your combined net gain/loss from the sale of farming business property reported on your 2009 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31.

32. Enter the amount from your 2008 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32.

33. Enter the amount from your 2008 Schedule(s) C (Form 1040), line 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33.

34. Enter the amount from your 2008 Schedule(s) E (Form 1040), line 32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34.

35. Enter the amount from your 2008 Form 4835, line 32 . . . . . . . . . . . . . . 35.

36. Enter your combined net gain/loss from the sale of farming business property reported on your 2008 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36.

37. Enter the amount from your 2007 Schedule(s) F (Form 1040), line 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37.

38. Enter the amount from your 2007 Schedule(s) C (Form 1040), line 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38.

39. Enter the amount from your 2007 Schedule(s) E (Form 1040), line 32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39.

40. Enter the amount from your 2007 Form 4835, line 32 . . . . . . . . . . . . . . 40.

41. Enter your combined net gain/loss from the sale of farming business property reported on your 2007 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41.

42. Combine lines 17 through 41. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42.

43. Enter the greater of line 42 or $300,000 ($150,000 if married filing separately) . . . . . . . . . . . . . . . . . . . . . . . . 43.

44. Add lines 16 and 43 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44.

45. Excess farm loss. Subtract line 5 from line 44. If zero or less, you have an excess farm loss that reduces the amount of loss you can deduct this year. If you have more than one farming business with an overall loss this year, allocate the excess farm loss amount on a pro rata basis among those farming businesses . . . . . . . . . . . . . . . . . 45.

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Excess Farm Loss Worksheet 5—Form 4835 for farm rental income or loss from farming business Keep for Your Records CAUTION: In determining if you have an excess farm loss, do not take into account any deductions for losses arising by reason of fire, storm, or other casualty, or by reason of disease or drought, involving your farming business.

1. Enter the amount from your 2012 Form 4835, line 31. Is this amount less than $300,000 ($150,000 if married filing separately)? If yes, stop here. You do not have an excess farm loss in 2012. If no, continue to line 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. Subtract $300,000 ($150,000 if married filing separately) from line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.

3. Enter the amount from your 2012 Form 4835, line 7 . . . . . . . . . . . . . . . 3. 4. Is line 3 greater than or equal to line 2? If yes, stop here. You do not have an excess farm loss in 2012. If no,

continue to line 5. 5. Enter your net gain/loss from the sale of farming business property reported

on Form 4797 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. 6. Enter your net gain/loss from the sale of farming business property reported

on Schedule D (Form 1040) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6. 7. Combine line 5 and line 6. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. 8. Add line 3 and line 7. Is this greater than or equal to line 2? If yes, stop here. You do not have an excess farm loss

in 2012. If no, continue to line 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8. 9. Enter the amount from your 2011 Form 4835, line 32 . . . . . . . . . . . . . . 9.

10. Enter your combined net gain/loss from the sale of farming business property reported on your 2011 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.

11. Enter the amount from your 2010 Form 4835, line 32 . . . . . . . . . . . . . . 11. 12. Enter your combined net gain/loss from the sale of farming business

property reported on your 2010 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.

13. Enter the amount from your 2009 Form 4835, line 32 . . . . . . . . . . . . . . 13. 14. Enter your combined net gain/loss from the sale of farming business

property reported on your 2009 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.

15. Enter the amount from your 2008 Form 4835, line 32 . . . . . . . . . . . . . . 15. 16. Enter your combined net gain/loss from the sale of farming business

property reported on your 2008 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.

17. Enter the amount from your 2007 Form 4835, line 32 . . . . . . . . . . . . . . 17. 18. Enter your combined net gain/loss from the sale of farming business

property reported on your 2007 Form 4797 and Schedule D (Form 1040). If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.

19. Combine lines 9 through 18. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19. 20. Enter the greater of line 19 or $300,000 ($150,000 if married filing separately) . . . . . . . . . . . . . . . . . . . . . . . 20. 21. Add lines 8 and 20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21. 22. Excess farm loss. Subtract line 1 from line 21. If zero or less, you have an excess farm loss that reduces the

amount of loss you can deduct this year. If you have more than one farming business with an overall loss this year, allocate the excess farm loss amount on a pro rata basis among those farming businesses . . . . . . . . . . . . 22.

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Department of the Treasury Internal Revenue Service

2012 Instructions for Schedule J Income Averaging for Farmers and Fishermen

Use Schedule J (Form 1040) to elect to figure your 2012 income tax by averaging, over the previous 3 years (base years), all or part of your 2012 taxable income from your trade or business of farming or fishing. This election may give you a lower tax if your 2012 income from farming or fishing is high and your taxable income for one or more of the 3 prior years was low.

In order to qualify for this election, you are not required to have been in the busi- ness of farming or fishing during any of the base years.

You may elect to average farming or fishing income even if your filing status was not the same in the election year and the base years.

This election does not apply when figuring your alternative minimum tax on Form 6251. Also, you do not have to recompute, because of this election, the tax liability of any minor child who was required to use your tax rates in the prior years.

Section references are to the Internal Revenue Code unless otherwise noted.

Future Developments For the latest information about devel- opments related to Schedule J (Form 1040) and its instructions, such as legis- lation enacted after they were published, go to www.irs.gov/form1040.

General Instructions Prior Year Tax Returns You may need copies of your original or amended income tax returns for 2009, 2010, and 2011 to figure your tax on Schedule J.

If you need copies of your tax re- turns, use Form 4506. There is a $57 fee (subject to change) for each return re- quested. If your main home, principal place of business, or tax records are lo- cated in a federally declared disaster area, this fee will be waived. If you want a free transcript of your tax return or ac- count, use Form 4506-T. See your Form 1040 instructions to find out how to get these forms.

Keep a copy of your 2012 income tax return to use for income averaging in 2013, 2014, or 2015.

Definitions Farming business. A farming business is the trade or business of cultivating land or raising or harvesting any agricul-

tural or horticultural commodity. This includes:

1. Operating a nursery or sod farm; 2. Raising or harvesting of trees

bearing fruits, nuts, or other crops; 3. Raising ornamental trees (but not

evergreen trees that are more than 6 years old when severed from the roots);

4. Raising, shearing, feeding, caring for, training, and managing animals; and

5. Leasing land to a tenant engaged in a farming business, but only if the lease payments are (a) based on a share of the tenant's production (not a fixed amount), and (b) determined under a written agreement entered into before the tenant begins significant activities on the land.

A farming business does not include: Contract harvesting of an agricul-

tural or horticultural commodity grown or raised by someone else, or

Merely buying or reselling plants or animals grown or raised by someone else.

Fishing business. A fishing business is the trade or business of fishing in which the fish harvested, either in whole or in part, are intended to enter commerce or enter commerce through sale, barter, or trade. This includes:

1. The catching, taking, or harvest- ing of fish;

2. The attempted catching, taking, or harvesting of fish;

3. Any other activity which can rea- sonably be expected to result in the catching, taking, or harvesting of fish;

4. Any operations at sea in support of, or in preparation for, any activity de- scribed in (1) through (3) above;

5. Leasing a fishing vessel, but only if the lease payments are (a) based on a share of the catch (or a share of the pro- ceeds from the sale of the catch) from the lessee's use of the vessel in a fishing business (not a fixed payment), and (b) determined under a written lease entered into before the lessee begins any signifi- cant fishing activities resulting in the catch; and

6. Compensation as a crew member on a vessel engaged in a fishing busi- ness, but only if the compensation is based on a share of the catch (or a share of the proceeds from the sale of the catch).

The word fish means finfish, mol- lusks, crustaceans, and all other forms of marine animal and plant life other than marine mammals and birds.

A fishing business does not include any scientific research activity conduc- ted by a scientific research vessel.

Settlement from Exxon Valdez liti­ gation. You will be treated as engaged in a fishing business with respect to any qualified settlement income you re- ceived if either of the following applies.

1. You were a plaintiff in the civil action In re Exxon Valdez, No.

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89-095-CV (HRH) (Consolidated) (D. Alaska); or

2. All of the following apply. a. You were a beneficiary of a

plaintiff described in (1) above, b. You acquired the right to receive

qualified settlement income from that plaintiff, and

c. You were the spouse or an imme- diate relative of that plaintiff.

Qualified settlement income is any taxable interest and punitive damage awards you received (whether as lump sums or periodic payments) in connec- tion with the Exxon Valdez civil action described above. Qualified settlement income includes all such awards, wheth- er received before or after the judgment and whether related to a settlement or a judgment.

Additional Information See Pub. 225 and Regulations section 1.1301-1 for more information.

Specific Instructions Line 2a Elected Farm Income To figure your elected farm income, first figure your taxable income from farm- ing or fishing. This includes all income, gains, losses, and deductions attributable to your farming or fishing business. If you conduct both farming and fishing businesses, you must figure your elected farm income by combining income, gains, losses, and deductions attributable to your farming and fishing businesses.

Elected farm income also includes any gain or loss from the sale or other disposition of property regularly used in your farming or fishing business for a substantial period of time. However, if such gain or loss is realized after cessa- tion of the farming or fishing business, the gain or loss is treated as attributable to a farming or fishing business only if the property is sold within a reasonable time after cessation of the farming or fishing business. A sale or other disposi- tion within 1 year of the cessation is considered to be within a reasonable time.

Elected farm income does not include income, gain, or loss from the sale or other disposition of land or from the sale of development rights, grazing rights, and other similar rights.

You should find your income, gains, losses, and deductions from farming or fishing reported on different tax forms, such as:

2012 Form 1040, line 7, or Form 1040NR, line 8, income from wages and other compensation you received (a) as a shareholder in an S corporation engaged in a farming or fishing business or (b) as a crew member on a vessel engaged in a fishing business (but see Fishing busi­ ness, earlier);

2012 Form 1040, line 21, or Form 1040NR, line 21, income from Exxon Valdez litigation;

2012 Form 1040, line 27, or Form 1040NR, line 27, deductible part of self-employment tax, but only to the ex- tent that deduction is attributable to your farming or fishing business;

2012 Form 1040, line 43, or Form 1040NR, line 41, CCF reduction, except to the extent that any earnings (without regard to the carryback of any net oper- ating or net capital loss) from the opera- tion of agreement vessels in the fisheries of the United States or in the foreign or domestic commerce of the United States are not attributable to your fishing busi- ness;

Schedule C or C-EZ; Schedule D; Schedule E, Part II; Schedule F; Form 4797; Form 4835; Form 8903, domestic production

activities deduction, but only to the ex- tent that deduction is attributable to your farming or fishing business; and

Form 8949.

Your elected farm income is the amount of your taxable income from farming or fishing that you elect to in- clude on line 2a.

You do not have to include all of your taxable income from farming or fishing on line 2a.

It may be to your advantage to include less than the entire amount, depending on how the amount you include on line 2a affects your tax bracket for the current and prior 3 tax years.

TIP

If you received certain subsidies in 2012, your elected farm income cannot include excess farm losses. See the In- structions for Schedule F (Form 1040).

Your elected farm income cannot ex- ceed your taxable income.

Lines 2b and 2c Complete lines 2b and 2c if the amount of your elected farm income on line 2a includes net capital gain. Net capital gain is the excess, if any, of net long-term capital gain over net short-term capital loss. Line 2b. Enter on line 2b the portion of your elected farm income on line 2a treated as a net capital gain. The amount you enter on line 2b cannot exceed the smaller of your total net capital gain or the net capital gain attributable to your farming or fishing business. Line 2c. Enter on line 2c the smaller of line 2b or the unrecaptured section 1250 gain attributable to your farming or fish- ing business, if any.

Line 4 Figure the tax on the amount on line 3 using:

The 2012 Tax Table, Tax Compu- tation Worksheet, or Qualified Divi- dends and Capital Gain Tax Worksheet from the 2012 Instructions for Form 1040 or Form 1040NR;

The 2012 Foreign Earned Income Tax Worksheet from the 2012 Instruc- tions for Form 1040; or

The Schedule D Tax Worksheet in the 2012 Instructions for Schedule D.

Enter the tax on line 4.

Line 5 If you used Schedule J to figure your tax for:

2011 (that is, you entered the amount from the 2011 Schedule J, line 23, on line 44 of your 2011 Form 1040, on line 42 of your 2011 Form 1040NR, or on Form 1040X for 2011), enter on line 5 the amount from your 2011 Schedule J, line 11.

2010 but not 2011, enter on line 5 the amount from your 2010 Schedule J, line 15.

2009 but not 2010 or 2011, enter on line 5 the amount from your 2009 Schedule J, line 3.

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If you figured your tax for 2009, 2010, and 2011 without using Sched- ule J, enter on line 5 the taxable income from your 2009 tax return (or as previ- ously adjusted by the IRS, or corrected on an amended return). But if that amount is zero or less, complete the 2009 Taxable Income Worksheet to fig- ure the amount to enter on line 5.

If you did not file a tax return for 2009, use the amount you would have reported as your taxable income had you been required to file a tax return. Be sure to keep all your records for 2009 for at least 3 years after April 15, 2013 (or the date you file your 2012 tax re- turn, if later).

Instructions for 2009 Taxable Income Worksheet Line 2. Any net capital loss deduction on your 2009 Schedule D, line 21, is not allowed for income averaging purposes to the extent it did not reduce your capi- tal loss carryover to 2010. This could happen if the taxable income before sub- tracting exemptions—shown on your 2009 Form 1040, line 41, or your 2009 Form 1040NR, line 38 (or as previously

adjusted)—was less than zero. Enter on line 2 the amount by which your 2009 capital loss carryover to 2010 (the sum of your short- and long-term capital loss carryovers) exceeds the excess of the loss on your 2009 Schedule D, line 16, over the loss on your 2009 Schedule D, line 21. If you had any Net Operating Loss (NOL) carrybacks to 2009, be sure you refigured your 2009 capital loss car- ryover to 2010. Line 3. If you had an NOL for 2009, enter the amount of that NOL from line 25 of the 2009 Form 1045, Sched- ule A, you filed with Form 1045 or Form 1040X. If you did not have an NOL for 2009, enter the portion, if any, of the NOL carryovers and carrybacks to 2009 that were not used in 2009 and were carried to years after 2009.

Example. John Farmington, who is single, did not use income averaging for 2009, 2010, or 2011. For 2012, John has $18,000 of elected farm income on Schedule J, line 2a. The taxable income before subtracting exemptions on his 2009 Form 1040, line 41, is $4,500. A deduction for exemptions of $3,650 is shown on line 42, and line 43, taxable income, is $850. However, John had a $21,200 NOL for 2010, $9,000 of which was remaining to carry to 2009 after the NOL was carried back to 2008. To com- plete line 1 of the 2009 Taxable Income Worksheet, John combines the $9,000 NOL deduction with the $850 from his 2009 Form 1040, line 43. The result is a negative $8,150, John's 2009 taxable in-

come, which he enters as a positive amount on line 1 of the 2009 Taxable Income Worksheet.

When John filed his 2009 tax return, he had a $3,000 net capital loss deduc- tion on Schedule D, line 21 (which was also entered on Form 1040, line 13), a $7,000 loss on Schedule D, line 16, and a $4,000 capital loss carryover to 2010. However, when John carried back the 2010 NOL ($9,000 of which was carried to 2009), he refigured his 2009 capital loss carryover to 2010 as $7,000. John adds the $3,000 from Schedule D, line 21, and the $7,000 carryover. He subtracts from the $10,000 result the $7,000 loss on his Schedule D, line 16, and enters $3,000 on line 2 of the work- sheet.

John had $850 of taxable income in 2009 that reduced the 2010 NOL carry- back. The $3,650 exemption deduction and $3,000 net capital loss deduction al- so reduced the amount of the 2010 NOL carryback. As a result, only $1,500 was available to carry to 2011 and later years, as shown on line 10 of his 2010 Form 1045, Schedule B. John enters the $1,500 on line 3 of the worksheet, and $4,500 ($1,500 plus the $3,000 line 2 amount) on line 4. He then subtracts the $4,500 from the $8,150 on line 1 and en- ters the result, $3,650, on line 5 of the worksheet. He enters a negative $3,650 on Schedule J, line 5. He combines that amount with the $6,000 on Schedule J, line 6, and enters $2,350 on Schedule J, line 7.

2009 Taxable Income Worksheet—Line 5 Keep for Your Records Complete this worksheet if you did not use Schedule J to figure your tax for 2010 and 2011 and your 2009 taxable income was zero or less. See the instructions above before completing this worksheet for line 5.

1. Figure the taxable income from your 2009 tax return (or as previously adjusted) without limiting it to zero. If you had an NOL for 2009, do not include any NOL carryovers or carrybacks to 2009. Enter the result as a positive amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. If there is a loss on your 2009 Schedule D, line 21, add that loss (as a positive amount) and your 2009 capital loss carryover to 2010. Subtract from that sum the amount of the loss on your 2009 Schedule D, line 16, and enter the result . . . . . . . . . 2.

3. If you had an NOL for 2009, enter it as a positive amount. Otherwise, enter as a positive amount the portion, if any, of the NOL carryovers and carrybacks to 2009 that were not used in 2009 and were carried to years after 2009 . . . . . . . . . . . . . . . . . 3.

4. Add lines 2 and 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. 5. Subtract line 4 from line 1. Enter the result as a negative amount on Schedule J, line 5 . . . . . . . . . . . . . . . 5.

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Line 8 If line 7 is zero, enter -0- on line 8. Oth- erwise, figure the tax on the amount on line 7 using:

The 2009 Tax Rate Schedules be- low,

The 2009 Qualified Dividends and Capital Gain Tax Worksheet, later,

The 2009 Schedule D Tax Work- sheet in the 2009 Schedule D instruc- tions (but use the 2009 Tax Rate Sched- ules below when figuring the tax on lines 33 and 35 of the Schedule D Tax Worksheet), or

The 2009 Foreign Earned Income Tax Worksheet, later.

If your elected farm income includes net capital gain, you must use the 2009 Schedule D Tax Worksheet to figure the tax on the amount on line 7. However, if

you filed Form 2555 or 2555-EZ for 2009, you must first complete the 2009 Foreign Earned Income Tax Worksheet, and then use the 2009 Schedule D Tax Worksheet to figure the tax on the amount on line 3 of that worksheet.

When completing the Schedule D Tax Worksheet, you must allocate 1/3 of the amount on line 2b (and 1/3 of the amount on line 2c, if any) to 2009. If for 2009 you had a capital loss that resulted in a capital loss carryover to 2010, do not reduce the elected farm income allo- cated to 2009 by any part of the carry- over.

2009 Tax Rate Schedules—Line 8 Schedule X—Use if your 2009 filing status was Single or you checked filing status box 1 or 2 on Form 1040NR

Schedule Y-2—Use if your 2009 filing status was Married filing separately or you checked filing status box 3, 4, or 5 on Form 1040NR

If Schedule J, line 7, is: Over— But not

over—

Enter on Schedule J, line 8

of the amount over—

If Schedule J, line 7, is: Over—

But not over—

Enter on Schedule J,

line 8 of the amount over—

$0 8,350

33,950 82,250

171,550 372,950

$8,350 33,950 82,250

171,550 372,950 .............

........... $835.00 + 4,675.00 +

16,750.00 + 41,754.00 + 108,216.00+

10% 15% 25% 28% 33% 35%

$0 8,350

33,950 82,250

171,550 372,950

$0 8,350

33,950 68,525

104,425 186,475

$8,350 33,950 68,525

104,425 186,475 .............

........... $835.00 + 4,675.00 + 13,318.75+ 23,370.75+ 50,447.25+

10% 15% 25% 28% 33% 35%

$0 8,350

33,950 68,525

104,425 186,475

Schedule Y-1—Use if your 2009 filing status was Married filing jointly or Qualifying widow(er) or you checked filing status box 6 on Form 1040NR

Schedule Z—Use if your 2009 filing status was Head of household

If Schedule J, line 7, is: Over— But not

over—

Enter on Schedule J, line 8

of the amount over—

If Schedule J, line 7, is: Over—

But not over—

Enter on Schedule J,

line 8 of the amount over—

$0 16,700 67,900

137,050 208,850 372,950

$16,700 67,900

137,050 208,850 372,950 ............

........... $1,670.00 + 9,350.00 +

26,637.50 + 46,741.50 + 100,894.50+

10% 15% 25% 28% 33% 35%

$0 16,700 67,900

137,050 208,850 372,950

$0 11,950 45,500

117,450 190,200 372,950

$11,950 45,500

117,450 190,200 372,950 .............

........... $1,195.00+

6,227.50 + 24,215.00+ 44,585.00+

104,892.50+

10% 15% 25% 28% 33% 35%

$0 11,950 45,500

117,450 190,200 372,950

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2009 Qualified Dividends and Capital Gain Tax Worksheet—Line 8 Keep for Your Records Use this worksheet only if both of the following apply.

Your elected farm income on your 2012 Schedule J, line 2a, does not include any net capital gain. You (a) entered qualified dividends on your 2009 Form 1040, line 9b (or your 2009 Form 1040A, line 9b, or 2009 Form 1040NR,

line 10b); (b) entered capital gain distributions directly on your 2009 Form 1040, line 13 (or your 2009 Form 1040A, line 10, or 2009 Form 1040NR, line 14) and were not required to file Schedule D; or (c) filed Schedule D in 2009 and you answered “Yes” on lines 17 and 20 of that Schedule D.

1. Amount from your 2012 Schedule J, line 7. If for 2009 you filed Form 2555 or 2555-EZ, enter the amount from line 3 of the 2009 Foreign Earned Income Tax Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. Amount from your 2009 Form 1040, line 9b* (or your 2009 Form 1040A, line 9b, or 2009 Form 1040NR, line 10b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.

3. Did you file Schedule D in 2009?*

Yes. Enter the smaller of line 15 or 16 of your 2009 Schedule D, but do not enter less than -0- . . .3.

No. Enter the amount from your 2009 Form 1040, line 13 (or your 2009 Form 1040A, line 10, or 2009 Form 1040NR, line 14)

4. Add lines 2 and 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.

5. Amount, if any, from your 2009 Form 4952, line 4g . . . . . 5.

6. Subtract line 5 from line 4. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.

7. Subtract line 6 from line 1. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.

8. Enter the smaller of:

The amount on line 1, or

$33,950 if single or married filing separately or if you checked filing status box 1, 2, 3, 4, or 5 on Form 1040NR; . . . . . . . . . . . . 8.

$67,900 if married filing jointly or qualifying widow(er) or if you checked filing status box 6 on Form 1040NR; $45,500 if head of household.

9. Is the amount on line 7 equal to or more than the amount on line 8?

Yes. Skip lines 9 and 10; go to line 11 and check the "No" box.

No. Enter the amount from line 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.

10. Subtract line 9 from line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.

11. Are the amounts on lines 6 and 10 the same?

Yes. Skip lines 11 through 14; go to line 15.

No. Enter the smaller of line 1 or line 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.

12. Enter the amount from line 10 (if line 10 is blank, enter -0-) . . . . . . . . . . . . . . . . . . . . 12.

13. Subtract line 12 from line 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.

14. Multiply line 13 by 15% (.15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.

15. Figure the tax on the amount on line 7. Use the 2009 Tax Rate Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . 15.

16. Add lines 14 and 15 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.

17. Figure the tax on the amount on line 1. Use the 2009 Tax Rate Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17.

18. Tax. Enter the smaller of line 16 or line 17 here and on your 2012 Schedule J, line 8. If for 2009 you filed Form 2555 or 2555-EZ, do not enter this amount on Schedule J, line 8. Instead, enter it on line 4 of the 2009 Foreign Earned Income Tax Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.

*If for 2009 you filed Form 2555 or 2555­EZ, see the footnote in the 2009 Foreign Earned Income Tax Worksheet before completing this line.

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2009 Foreign Earned Income Tax Worksheet—Line 8 Keep for Your Records Use this worksheet if you claimed the foreign earned income exclusion or housing exclusion on your 2009 Form 1040 using Form 2555 or 2555-EZ. However, if Schedule J, line 7, is zero or less do not complete this worksheet.

1. Enter the amount from your 2012 Schedule J, line 7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. Enter the amount from your (and your spouse's, if filing jointly) 2009 Form 2555, lines 45 and 50, or Form 2555-EZ, line 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.

3. Add lines 1 and 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.

4. Tax on the amount on line 3. Use the 2009 Tax Rate Schedules, the 2009 Qualified Dividends and Capital Gain Tax Worksheet,* or the 2009 Schedule D Tax Worksheet in the 2009 Schedule D instructions,* whichever applies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.

5. Tax on the amount on line 2. Use the 2009 Tax Rate Schedules. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.

6. Subtract line 5 from line 4. Enter the result. If zero or less, enter -0-. Also include this amount on your 2012 Schedule J, line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.

*Enter the amount from line 3 above on line 1 of the 2009 Qualified Dividends and Capital Gain Tax Worksheet or the 2009 Schedule D Tax Worksheet if you use either of those worksheets to figure the tax on line 4 above. Complete the rest of that worksheet through line 6 (line 10 if you use the Schedule D Tax Worksheet). Next, you must determine if you had a capital gain excess. To find out if you had a capital gain excess, subtract the amount from your 2012 Schedule J, line 7, from line 6 of your 2009 Qualified Dividends and Capital Gain Tax Worksheet (line 10 of your 2009 Schedule D Tax Worksheet). If the result is more than zero, that amount is your capital gain excess. If you did not have a capital gain excess, complete the rest of either of those worksheets according to the worksheet's instructions. Then complete lines 5 and 6 above. If you had a capital gain excess, complete a second 2009 Qualified Dividends and Capital Gain Tax Worksheet or 2009 Schedule D Tax Worksheet (whichever applies) as instructed above but in its entirety and with the following additional modifications. Then complete lines 5 and 6 above. These modifications are to be made only for purposes of filling out the 2009 Foreign Earned Income Tax Worksheet above.

1. Reduce (but not below zero) the amount you would otherwise enter on line 3 of your 2009 Qualified Dividends and Capital Gain Tax Worksheet or line 9 of your 2009 Schedule D Tax Worksheet by your capital gain excess.

2. Reduce (but not below zero) the amount you would otherwise enter on line 2 of your 2009 Qualified Dividends and Capital Gain Tax Worksheet or line 6 of your 2009 Schedule D Tax Worksheet by any of your capital gain excess not used in (1) above.

3. Reduce (but not below zero) the amount on your 2009 Schedule D (Form 1040), line 18, by your capital gain excess.

4. Include your capital gain excess as a loss on line 16 of your 2009 Unrecaptured Section 1250 Gain Worksheet in the 2009 Instructions for Schedule D (Form 1040).

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Line 9 If you used Schedule J to figure your tax for:

2011 (that is, you entered the amount from the 2011 Schedule J, line 23, on line 44 of your 2011 Form 1040, on line 42 of 2011 Form 1040NR, or on Form 1040X for 2011), enter on line 9 the amount from your 2011 Schedule J, line 15.

2010 but not 2011, enter on line 9 the amount from your 2010 Schedule J, line 3.

If you figured your tax for both 2010 and 2011 without using Schedule J, en- ter on line 9 the taxable income from your 2010 tax return (or as previously adjusted by the IRS or corrected on an amended return). But if that amount is zero or less, complete the worksheet be- low to figure the amount to enter on line 9.

If you did not file a tax return for 2010, use the amount you would have reported as your taxable income had you been required to file a tax return. Be sure to keep all your records for 2010 until at least 3 years after April 15, 2013 (or the date you file your 2012 tax re- turn, if later).

Instructions for 2010 Taxable Income Worksheet Line 2. Any net capital loss deduction on your 2010 Schedule D, line 21, is not allowed for income averaging purposes

to the extent it did not reduce your capi- tal loss carryover to 2011. This could happen if the taxable income before sub- tracting exemptions—shown on your 2010 Form 1040, line 41, or your 2010 Form 1040NR, line 39 (or as previously adjusted)—was less than zero. Enter on line 2 the amount by which your 2010 capital loss carryover to 2011 (the sum of your short- and long-term capital loss carryovers) exceeds the excess of the loss on your 2010 Schedule D, line 16, over the loss on your 2010 Schedule D, line 21. If you had any NOL carrybacks to 2010, be sure you refigured your 2010 capital loss carryover to 2011. Line 3. If you had an NOL for 2010, enter the amount of that NOL from line 25 of the 2010 Form 1045, Sched- ule A, you filed with Form 1045 or Form 1040X. If you did not have an NOL for 2010, enter the portion, if any, of the NOL carryovers and carrybacks to 2010 that were not used in 2010 and were carried to years after 2010.

Example. John Farmington did not use income averaging for 2009, 2010, or 2011. The taxable income before sub- tracting exemptions on his 2010 Form 1040, line 41, is a negative $29,900. A deduction for exemptions of $3,650 is shown on line 42, and line 43, taxable income, is limited to zero. John subtracts from the $29,900 loss the $3,650 deduc- tion for exemptions. The result is a neg- ative $33,550, John's 2010 taxable in- come, which he enters as a positive

amount on line 1 of the 2010 Taxable Income Worksheet.

When John filed his 2010 tax return, he had a $3,000 net capital loss deduc- tion on Schedule D, line 21 (which was also entered on Form 1040, line 13), and a $7,000 loss on Schedule D, line 16 (as adjusted). He also had a $7,000 capital loss carryover to 2011. John adds the $3,000 from Schedule D, line 21, and the $7,000 carryover. He subtracts from the $10,000 result the $7,000 loss on his Schedule D, line 16, and enters $3,000 on line 2 of the worksheet.

John enters $21,200 on line 3 of the worksheet, the 2010 NOL from his 2010 Form 1045, Schedule A, line 25. Of the $33,550 negative taxable income, the $3,650 deduction for exemptions, the $3,000 capital loss deduction, and his $5,700 standard deduction were not al- lowed in figuring the NOL. John had a $21,200 loss on his 2010 Schedule F, the only other item on his 2010 tax re- turn.

John enters $24,200 (the $3,000 line 2 amount plus the $21,200 line 3 amount) on line 4 and $9,350 (the $33,550 line 1 amount minus the $24,200 line 4 amount) on line 5. He en- ters $9,350 as a negative amount on Schedule J, line 9. He enters $6,000 on Schedule J, line 10, and a negative $3,350 on Schedule J, line 11. If he uses Schedule J to figure his tax for 2013, he will enter the negative $3,350 amount on his 2013 Schedule J as his 2010 taxa- ble income for income averaging purpo- ses.

2010 Taxable Income Worksheet—Line 9 Keep for Your Records Complete this worksheet if you did not use Schedule J to figure your tax for 2011 and your 2010 taxable income was zero or less. See the instructions above before completing this worksheet.

1. Figure the taxable income from your 2010 tax return (or as previously adjusted) without limiting it to zero. If you had an NOL for 2010, do not include any NOL carryovers or carrybacks to 2010. Enter the result as a positive amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. If there is a loss on your 2010 Schedule D, line 21, add that loss (as a positive amount) and your 2010 capital loss carryover to 2011. Subtract from that sum the amount of the loss on your 2010 Schedule D, line 16, and enter the result . . . . . . . . . 2.

3. If you had an NOL for 2010, enter it as a positive amount. Otherwise, enter as a positive amount the portion, if any, of the NOL carryovers and carrybacks to 2010 that were not used in 2010 and were carried to years after 2010 . . . . . . . . . . . . . . . . . 3.

4. Add lines 2 and 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. 5. Subtract line 4 from line 1. Enter the result as a negative amount on Schedule J, line 9 . . . . . . . . . . . . . . . 5.

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Line 12 If line 11 is zero or less, enter -0- on line 12. Otherwise, figure the tax on the amount on line 11 using:

The 2010 Tax Rate Schedules be- low,

The 2010 Qualified Dividends and Capital Gain Tax Worksheet, later,

The 2010 Schedule D Tax Work- sheet in the 2010 Schedule D instruc- tions (but use the 2010 Tax Rate Sched- ules below when figuring the tax on the Schedule D Tax Worksheet, lines 34 and 36), or

The 2010 Foreign Earned Income Tax Worksheet, later.

If your elected farm income includes net capital gain, you must use the 2010 Schedule D Tax Worksheet to figure the tax on the amount on line 11. However,

if you filed Form 2555 or 2555-EZ for 2010, you must first complete the 2010 Foreign Earned Income Tax Worksheet, and then use the 2010 Schedule D Tax Worksheet to figure the tax on the amount on line 3 of that worksheet.

When completing the Schedule D Tax Worksheet, you must allocate 1/3 of the amount on line 2b (and 1/3 of the amount on line 2c, if any) to 2010. If for 2010 you had a capital loss that resulted in a capital loss carryover to 2011, do not reduce the elected farm income allo- cated to 2010 by any part of the carry- over.

2010 Tax Rate Schedules—Line 12 Schedule X—Use if your 2010 filing status was Single or you checked filing status box 1 or 2 on Form 1040NR

Schedule Y-2—Use if your 2010 filing status was Married filing separately or you checked filing status box 3, 4, or 5 on Form 1040NR

If Schedule J, line 11, is: Over—

But not over—

Enter on Schedule J, line 12

of the amount over—

If Schedule J, line 11, is: Over—

But not over—

Enter on Schedule J,

line 12 of the amount over—

$0 8,375

34,000 82,400

171,850 373,650

$8,375 34,000 82,400

171,850 373,650 .............

........... $837.50 + 4,681.25 + 16,781.25+ 41,827.25+

108,421.25+

10% 15% 25% 28% 33% 35%

$0 8,375

34,000 82,400

171,850 373,650

$0 8,375

34,000 68,650

104,625 186,825

$8,375 34,000 68,650

104,625 186,825 .............

........... $837.50 + 4,681.25 + 13,343.75+ 23,416.75+ 50,542.75+

10% 15% 25% 28% 33% 35%

$0 8,375

34,000 68,650

104,625 186,825

Schedule Y-1—Use if your 2010 filing status was Married filing jointly or Qualifying widow(er) or you checked filing status box 6 on Form 1040NR

Schedule Z—Use if your 2010 filing status was Head of household

If Schedule J, line 11, is: Over—

But not over—

Enter on Schedule J, line 12

of the amount over—

If Schedule J, line 11, is: Over—

But not over—

Enter on Schedule J,

line 12 of the amount over—

$0 16,750 68,000

137,300 209,250 373,650

$16,750 68,000

137,300 209,250 373,650 ............

........... $1,675.00+ 9,362.50 + 26,687.50+ 46,833.50+

101,085.50+

10% 15% 25% 28% 33% 35%

$0 16,750 68,000

137,300 209,250 373,650

$0 11,950 45,550

117,650 190,550 373,650

$11,950 45,550

117,650 190,550 373,650 .............

........... $1,195.00 +

6,235.00 + 24,260.00+ 44,672.00+

105,095.00+

10% 15% 25% 28% 33% 35%

$0 11,950 45,550

117,650 190,550 373,650

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2010 Qualified Dividends and Capital Gain Tax Worksheet—Line 12 Keep for Your Records Use this worksheet only if both of the following apply.

Your elected farm income on your 2012 Schedule J, line 2a, does not include any net capital gain. You (a) entered qualified dividends on your 2010 Form 1040, line 9b (or your 2010 Form 1040A, line 9b, or 2010 Form 1040NR,

line 10b); (b) entered capital gain distributions directly on your 2010 Form 1040, line 13 (or your 2010 Form 1040A, line 10, or 2010 Form 1040NR, line 14) and were not required to file Schedule D; or (c) filed Schedule D in 2010 and you answered “Yes” on lines 17 and 20 of that Schedule D.

1. Amount from your 2012 Schedule J, line 11. If for 2010 you filed Form 2555 or 2555-EZ, enter the amount from line 3 of the 2010 Foreign Earned Income Tax Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. Amount from your 2010 Form 1040, line 9b* (or your 2010 Form 1040A, line 9b, or 2010 Form 1040NR, line 10b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.

3. Did you file Schedule D in 2010?*

Yes. Enter the smaller of line 15 or 16 of your 2010 Schedule D, but do not enter less than -0- . .3.

No. Enter the amount from your 2010 Form 1040, line 13 (or your 2010 Form 1040A, line 10, or 2010 Form 1040NR, line 14)

4. Add lines 2 and 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.

5. Amount, if any, from your 2010 Form 4952, line 4g . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.

6. Subtract line 5 from line 4. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.

7. Subtract line 6 from line 1. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.

8. Enter one of the following three amounts depending on your filing status:

$34,000 if single or married filing separately, or if you checked filing status box 1, 2, 3, 4, or 5 on Form 1040NR; . . . . . . . . . . . . 8.

$68,000 if married filing jointly or qualifying widow(er) or if you checked filing status box 6 on Form 1040NR;

$45,550 if head of household. 9. Enter the smaller of line 1 or line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.

10. Enter the smaller of line 7 or line 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.

11. Subtract line 10 from line 9. This amount is taxed at 0% . . . . . . . . . . . . . . . . . . . . . . . 11.

12. Enter the smaller of line 1 or line 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.

13. Enter the amount from line 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.

14. Subtract line 13 from line 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.

15. Multiply line 14 by 15% (.15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15.

16. Figure the tax on the amount on line 7. Use the 2010 Tax Rate Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . .16.

17. Add lines 15 and 16 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17.

18. Figure the tax on the amount on line 1. Use the 2010 Tax Rate Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . .18.

19. Tax. Enter the smaller of line 17 or line 18 here and on your 2012 Schedule J, line 12. If for 2010 you filed Form 2555 or 2555-EZ, do not enter this amount on Schedule J, line 12. Instead, enter it on line 4 of the 2010 Foreign Earned Income Tax Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19.

*If for 2010 you filed Form 2555 or 2555­EZ, see the footnote in the 2010 Foreign Earned Income Tax Worksheet before completing this line.

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2010 Foreign Earned Income Tax Worksheet—Line 12 Keep for Your Records Use this worksheet if you claimed the foreign earned income exclusion or housing exclusion on your 2010 Form 1040 using Form 2555 or 2555-EZ. However, if Schedule J, line 11, is zero or less do not complete this worksheet.

1. Enter the amount from your 2012 Schedule J, line 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1. 2. Enter the amount from your (and your spouse's, if filing jointly) 2010 Form 2555, lines 45 and 50,

or Form 2555-EZ, line 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2. 3. Add lines 1 and 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3. 4. Tax on the amount on line 3. Use the 2010 Tax Rate Schedules, the 2010 Qualified Dividends and

Capital Gain Tax Worksheet,* or the 2010 Schedule D Tax Worksheet in the 2010 Schedule D instructions,* whichever applies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.

5. Tax on the amount on line 2. Use the 2010 Tax Rate Schedules. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. 6. Subtract line 5 from line 4. Enter the result. If zero or less, enter -0-. Also include this amount on

your 2012 Schedule J, line 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.

*Enter the amount from line 3 above on line 1 of the 2010 Qualified Dividends and Capital Gain Tax Worksheet or the 2010 Schedule D Tax Worksheet if you use either of those worksheets to figure the tax on line 4 above. Complete the rest of that worksheet through line 6 (line 10 if you use the Schedule D Tax Worksheet). Next, you must determine if you had a capital gain excess. To find out if you had a capital gain excess, subtract the amount from your 2012 Schedule J, line 11, from line 6 of your 2010 Qualified Dividends and Capital Gain Tax Worksheet (line 10 of your 2010 Schedule D Tax Worksheet). If the result is more than zero, that amount is your capital gain excess. If you did not have a capital gain excess, complete the rest of either of those worksheets according to the worksheet's instructions. Then complete lines 5 and 6 above. If you had a capital gain excess, complete a second 2010 Qualified Dividends and Capital Gain Tax Worksheet or 2010 Schedule D Tax Worksheet (whichever applies) as instructed above but in its entirety and with the following additional modifications. Then complete lines 5 and 6 above. These modifications are to be made only for purposes of filling out the 2010 Foreign Earned Income Tax Worksheet above. 1. Reduce (but not below zero) the amount you would otherwise enter on line 3 of your 2010 Qualified Dividends and Capital Gain Tax

Worksheet or line 9 of your 2010 Schedule D Tax Worksheet by your capital gain excess. 2. Reduce (but not below zero) the amount you would otherwise enter on line 2 of your 2010 Qualified Dividends and Capital Gain Tax

Worksheet or line 6 of your 2010 Schedule D Tax Worksheet by any of your capital gain excess not used in (1) above. 3. Reduce (but not below zero) the amount on your 2010 Schedule D (Form 1040), line 18, by your capital gain excess. 4. Include your capital gain excess as a loss on line 16 of your 2010 Unrecaptured Section 1250 Gain Worksheet in the 2010 Instructions for

Schedule D (Form 1040).

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Line 13 If you used Schedule J to figure your tax for 2011 (that is, you entered the amount from the 2011 Schedule J, line 23, on line 44 of your 2011 Form 1040, on line 42 of your 2011 Form 1040NR, or on Form 1040X for 2011), enter on line 13 the amount from your 2011 Schedule J, line 3.

If you did not use Schedule J to fig- ure your tax for 2011, enter on line 13 the taxable income from your 2011 tax return (or as previously adjusted by the IRS or corrected on an amended return). But if that amount is zero or less, com- plete the worksheet below to figure the amount to enter on line 13.

If you did not file a tax return for 2011, use the amount you would have reported as your taxable income had you been required to file a tax return. Be sure to keep all your records for 2011 until at least 3 years after April 15, 2013 (or the date you file your 2012 tax re- turn, if later).

Instructions for 2011 Taxable Income Worksheet Line 2. Any net capital loss deduction on your 2011 Schedule D, line 21, is not allowed for income averaging purposes to the extent it did not reduce your capi- tal loss carryover to 2012. This could happen if the taxable income before sub- tracting exemptions—shown on your 2011 Form 1040, line 41, or your 2011

Form 1040NR, line 39 (or as previously adjusted)—was less than zero. Enter on line 2 the amount by which your 2011 capital loss carryover to 2012 (the sum of your short- and long-term capital loss carryovers) exceeds the excess of the loss on your 2011 Schedule D, line 16, over the loss on your 2011 Schedule D, line 21. Line 3. If you had an NOL for 2011, enter the amount of that NOL from line 25 of the 2011 Form 1045, Sched- ule A, you filed with Form 1045 or Form 1040X. If you did not have an NOL for 2011, enter the portion, if any, of the NOL carryovers and carrybacks to 2011 that were not used in 2011 and were carried to years after 2011.

Example. John Farmington did not use income averaging for 2009, 2010, or 2011. The taxable income before sub- tracting exemptions on his 2011 Form 1040, line 41, is a negative $1,000. This amount includes an NOL deduction on his 2011 Form 1040, line 21, of $1,500. The $1,500 is the portion of the 2010 NOL that was remaining from 2009 to be carried to 2011. See the examples, earlier. A deduction for exemptions of $3,700 is shown on Form 1040, line 42, and line 43, taxable income, is limited to zero. John does not have an NOL for 2011. John subtracts from the $1,000 negative amount on Form 1040, line 41, the $3,700 deduction for exemptions. The result is a negative $4,700, John's 2011 taxable income, which he enters as

a positive amount on line 1 of the 2011 Taxable Income Worksheet.

When John filed his 2011 tax return, he had a $3,000 net capital loss deduc- tion on Schedule D, line 21 (which was also entered on Form 1040, line 13), a $7,000 loss on Schedule D, line 16, and a $5,000 capital loss carryover to 2012 (his 2011 capital loss carryover to 2012 was $5,000, not $4,000, because the amount on his Form 1040, line 41, was a negative $1,000). John adds the $3,000 from Schedule D, line 21, and the $5,000 carryover. He subtracts from the $8,000 result the $7,000 loss on his Schedule D, line 16, and enters $1,000 on line 2 of the worksheet.

John enters -0- on line 3 of the work- sheet because he does not have an NOL for 2011 and did not have an NOL car- ryover from 2011 available to carry to 2012 and later years. The NOL deduc- tion for 2011 of $1,500 was reduced to zero because it did not exceed his modi- fied taxable income of $3,500. Modified taxable income is figured by adding back the $3,000 net capital loss deduc- tion and the $3,700 exemption deduction to negative taxable income (figured without regard to the NOL deduction) of $3,200. John enters $1,000 on line 4 and $3,700 on line 5. He enters $3,700 as a negative amount on Schedule J, line 13. He enters $6,000 on Schedule J, line 14, and $2,300 on Schedule J, line 15. If he uses Schedule J to figure his tax for 2013, he will enter $2,300 on his 2013 Schedule J as his 2011 taxable income for income averaging purposes.

2011 Taxable Income Worksheet—Line 13 Keep for Your Records Complete this worksheet if your 2011 taxable income was zero or less. See the instructions above before completing this worksheet.

1. Figure the taxable income from your 2011 tax return (or as previously adjusted) without limiting it to zero. If you had an NOL for 2011, do not include any NOL carryovers or carrybacks to 2011. Enter the result as a positive amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. If there is a loss on your 2011 Schedule D, line 21, add that loss (as a positive amount) and your 2011 capital loss carryover to 2012. Subtract from that sum the amount of the loss on your 2011 Schedule D, line 16, and enter the result . . . . . . . . . 2.

3. If you had an NOL for 2011, enter it as a positive amount. Otherwise, enter as a positive amount the portion, if any, of the NOL carryovers and carrybacks to 2011 that were not used in 2011 and were carried to years after 2011 . . . . . . . . . . . . . . . . . 3.

4. Add lines 2 and 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. 5. Subtract line 4 from line 1. Enter the result as a negative amount on Schedule J, line 13 . . . . . . . . . . . . . . 5.

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Line 16 If line 15 is zero or less, enter -0- on line 16. Otherwise, figure the tax on the amount on line 15 using:

The 2011 Tax Rate Schedules be- low,

The 2011 Qualified Dividends and Capital Gain Tax Worksheet, later,

The 2011 Schedule D Tax Work- sheet in the 2011 Schedule D instruc- tions (but use the 2011 Tax Rate Sched- ules when figuring the tax on the Sched- ule D Tax Worksheet, lines 34 and 36), or

The 2011 Foreign Earned Income Tax Worksheet, later.

If your elected farm income includes net capital gain, you must use the 2011 Schedule D Tax Worksheet to figure the tax on the amount on line 15. However,

if you filed Form 2555 or 2555-EZ for 2011, you must first complete the 2011 Foreign Earned Income Tax Worksheet, and then use the 2011 Schedule D Tax Worksheet to figure the tax on the amount on line 3 of that worksheet.

When completing the Schedule D Tax Worksheet, you must allocate 1/3 of the amount on line 2b (and 1/3 of the amount on line 2c, if any) to 2011. If for 2011 you had a capital loss that resulted in a capital loss carryover to 2012, do not reduce the elected farm income allo- cated to 2011 by any part of the carry- over.

2011 Tax Rate Schedules—Line 16 Schedule X—Use if your 2011 filing status was Single or you checked filing status box 1 or 2 on Form 1040NR

Schedule Y-2—Use if your 2011 filing status was Married filing separately or you checked filing status box 3, 4, or 5 on Form 1040NR

If Schedule J, line 15, is: Over—

But not over—

Enter on Schedule J, line 16

of the amount over—

If Schedule J, line 15, is: Over—

But not over—

Enter on Schedule J,

line 16 of the amount over—

$0 8,500

34,500 83,600

174,400 379,150

$8,500 34,500 83,600

174,400 379,150 .............

........... $850.00 + 4,750.00 + 17,025.00+ 42,449.00+

110,016.50+

10% 15% 25% 28% 33% 35%

$0 8,500

34,500 83,600

174,400 379,150

$0 8,500

34,500 69,675

106,150 189,575

$8,500 34,500 69,675

106,150 189,575 .............

........... $850.00 + 4,750.00 + 13,543.75+ 23,756.75+ 51,287.00+

10% 15% 25% 28% 33% 35%

$0 8,500

34,500 69,675

106,150 189,575

Schedule Y-1—Use if your 2011 filing status was Married filing jointly or Qualifying widow(er) or you checked filing status box 6 on Form 1040NR

Schedule Z—Use if your 2011 filing status was Head of household

If Schedule J, line 15, is: Over—

But not over—

Enter on Schedule J, line 16

of the amount over—

If Schedule J, line 15, is: Over—

But not over—

Enter on Schedule J,

line 16 of the amount over—

$0 17,000 69,000

139,350 212,300 379,150

$17,000 69,000

139,350 212,300 379,150 ............

........... $1,700.00+ 9,500.00 + 27,087.50+ 47,513.50+

102,574.00+

10% 15% 25% 28% 33% 35%

$0 17,000 69,000

139,350 212,300 379,150

$0 12,150 46,250

119,400 193,350 379,150

$12,150 46,250

119,400 193,350 379,150 .............

........... $1,215.00+

6,330.00 + 24,617.50+ 45,323.50+

106,637.50+

10% 15% 25% 28% 33% 35%

$0 12,150 46,250

119,400 193,350 379,150

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2011 Qualified Dividends and Capital Gain Tax Worksheet—Line 16 Keep for Your Records Use this worksheet only if both of the following apply.

Your elected farm income on your 2012 Schedule J, line 2a, does not include any net capital gain. You (a) entered qualified dividends on your 2011 Form 1040, line 9b (or your 2011 Form 1040A, line 9b, or 2011 Form 1040NR,

line 10b); (b) entered capital gain distributions directly on your 2011 Form 1040, line 13 (or your 2011 Form 1040A, line 10, or 2011 Form 1040NR, line 14) and were not required to file Schedule D; or (c) filed Schedule D in 2011 and you answered “Yes” on lines 17 and 20 of that Schedule D.

1. Amount from your 2012 Schedule J, line 15. If for 2011 you filed Form 2555 or 2555-EZ, enter the amount from line 3 of the 2011 Foreign Earned Income Tax Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.

2. Amount from your 2011 Form 1040, line 9b* (or your 2011 Form 1040A, line 9b, or 2011 Form 1040NR, line 10b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.

3. Did you file Schedule D in 2011?*

Yes. Enter the smaller of line 15 or 16 of your 2011 Schedule D, but do not enter less than -0- . .3.

No. Enter the amount from your 2011 Form 1040, line 13 (or your 2011 Form 1040A, line 10, or 2011 Form 1040NR, line 14)

4. Add lines 2 and 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.

5. Amount, if any, from your 2011 Form 4952, line 4g . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.

6. Subtract line 5 from line 4. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.

7. Subtract line 6 from line 1. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.

8. Enter one of the following three amounts depending on your filing status:

$34,500 if single or married filing separately, or if you checked filing status box 1, 2, 3, 4, or 5 on Form 1040NR; . . . . . . . . . . . . 8.

$69,000 if married filing jointly or qualifying widow(er) or if you checked filing status box 6 on Form 1040NR;

$46,250 if head of household. 9. Enter the smaller of line 1 or line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9.

10. Enter the smaller of line 7 or line 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.

11. Subtract line 10 from line 9. This amount is taxed at 0% . . . . . . . . . . . . . . . . . . . . . . . 11.

12. Enter the smaller of line 1 or line 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.

13. Enter the amount from line 11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.

14. Subtract line 13 from line 12 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.

15. Multiply line 14 by 15% (.15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15.

16. Figure the tax on the amount on line 7. Use the 2011 Tax Rate Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . .16.

17. Add lines 15 and 16 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17.

18. Figure the tax on the amount on line 1. Use the 2011 Tax Rate Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . .18.

19. Tax. Enter the smaller of line 17 or line 18 here and on your 2012 Schedule J, line 16. If for 2011 you filed Form 2555 or 2555-EZ, do not enter this amount on Schedule J, line 16. Instead, enter it on line 4 of the 2011 Foreign Earned Income Tax Worksheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19.

*If for 2011 you filed Form 2555 or 2555­EZ, see the footnote in the 2011 Foreign Earned Income Tax Worksheet before completing this line.

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2011 Foreign Earned Income Tax Worksheet—Line 16 Keep for Your Records Use this worksheet if you claimed the foreign earned income exclusion or housing exclusion on your 2011 Form 1040 using Form 2555 or 2555-EZ. However, if Schedule J, line 15, is zero or less, do not complete this worksheet.

1. Enter the amount from your 2012 Schedule J, line 15 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1. 2. Enter the amount from your (and your spouse's, if filing jointly) 2011 Form 2555, lines 45 and 50,

or Form 2555-EZ, line 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2. 3. Add lines 1 and 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3. 4. Tax on the amount on line 3. Use the 2011 Tax Rate Schedules, the 2011 Qualified Dividends and

Capital Gain Tax Worksheet,* or the 2011 Schedule D Tax Worksheet in the 2011 Schedule D instructions,* whichever applies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.

5. Tax on the amount on line 2. Use the 2011 Tax Rate Schedules. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. 6. Subtract line 5 from line 4. Enter the result. If zero or less, enter -0-. Also include this amount on

your 2012 Schedule J, line 16 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.

*Enter the amount from line 3 above on line 1 of the 2011 Qualified Dividends and Capital Gain Tax Worksheet or the 2011 Schedule D Tax Worksheet if you use either of those worksheets to figure the tax on line 4 above. Complete the rest of that worksheet through line 6 (line 10 if you use the Schedule D Tax Worksheet). Next, you must determine if you had a capital gain excess. To find out if you had a capital gain excess, subtract the amount from your 2012 Schedule J, line 15, from line 6 of your 2011 Qualified Dividends and Capital Gain Tax Worksheet (line 10 of your 2011 Schedule D Tax Worksheet). If the result is more than zero, that amount is your capital gain excess. If you did not have a capital gain excess, complete the rest of either of those worksheets according to the worksheet's instructions. Then complete lines 5 and 6 above. If you had a capital gain excess, complete a second 2011 Qualified Dividends and Capital Gain Tax Worksheet or 2011 Schedule D Tax Worksheet (whichever applies) as instructed above but in its entirety and with the following additional modifications. Then complete lines 5 and 6 above. These modifications are to be made only for purposes of filling out the 2011 Foreign Earned Income Tax Worksheet above. 1. Reduce (but not below zero) the amount you would otherwise enter on line 3 of your 2011 Qualified Dividends and Capital Gain Tax

Worksheet or line 9 of your 2011 Schedule D Tax Worksheet by your capital gain excess. 2. Reduce (but not below zero) the amount you would otherwise enter on line 2 of your 2011 Qualified Dividends and Capital Gain Tax

Worksheet or line 6 of your 2011 Schedule D Tax Worksheet by any of your capital gain excess not used in (1) above. 3. Reduce (but not below zero) the amount on your 2011 Schedule D (Form 1040), line 18, by your capital gain excess. 4. Include your capital gain excess as a loss on line 16 of your 2011 Unrecaptured Section 1250 Gain Worksheet in the 2011 Instructions for

Schedule D (Form 1040).

Lines 19, 20, and 21 For reporting purposes, the “tax” line of your tax return may include amounts that are not tax imposed by section 1 of the Internal Revenue Code. For exam- ple, your "tax" line may, in addition to the tax imposed by section 1, include amounts from Forms 8814 or 4972; al- ternative minimum tax if you filed Form 1040A; or amounts from the recapture of an education credit. Do not include these other tax amounts on lines 19 through 21.

If you amended your return or the IRS made changes to it, make sure you enter the corrected amount.

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Department of the Treasury Internal Revenue Service

2012 Instructions for Schedule R (Form 1040A or 1040) Credit for the Elderly or the Disabled

Use Schedule R (Form 1040A or 1040) to figure the credit for the elder- ly or the disabled. Future Developments. For the latest information about developments related to Schedule R (Form 1040A or Form 1040) and it's instructions, such as legislation enacted after they were published, go to www.irs.gov/form1040. Additional information. See Pub. 524 for more details.

Who Can Take the Credit The credit is based on your filing status, age, and in- come. If you are married filing a joint return, it is al- so based on your spouse's age and income. You may be able to take this credit if either of the following applies.

1. You were age 65 or older at the end of 2012, or 2. You were under age 65 at the end of 2012 and

you meet all of the following. a. You were permanently and totally disabled on

the date you retired. If you retired before 1977, you must have been permanently and totally disabled on January 1, 1976, or January 1, 1977.

b. You received taxable disability income for 2012.

c. On January 1, 2012, you had not reached man- datory retirement age (the age when your employer's retirement program would have required you to re- tire).

For the definition of permanent and total disabili- ty, see What Is Permanent and Total Disability?, lat- er. Also, see the instructions for Part II.

Age 65 You are considered age 65 on the day before your 65th birthday. As a result, if you were born on Janu- ary 1, 1948, you are considered to be age 65 at the end of 2012.

Married Persons Filing Separate Returns If your filing status is married filing separately and you lived with your spouse at any time during 2012, you cannot take the credit.

Nonresident Aliens If you were a nonresident alien at any time during 2012, you may be able to take the credit only if your filing status is married filing jointly.

Income Limits See Income Limits for the Elderly or the Disabled, later.

Want the IRS To Figure Your Credit? If you can take the credit and you want us to figure it for you, check the box in Part I of Schedule R (Form 1040A or 1040) for your filing status and age. Fill in Part II and lines 11 and 13 of Part III if they apply to you. If you file Form 1040A, enter “CFE” in the space to the left of Form 1040A, line 30. If you file Form 1040, check box c on Form 1040, line 53, and enter “CFE” on the line next to that box. Attach Schedule R (Form 1040A or 1040) to your return.

What Is Permanent and Total Disability? A person is permanently and totally disabled if both 1 and 2 below apply.

1. He or she cannot engage in any substantial gainful activity because of a physical or mental con- dition.

2. A qualified physician determines that the con- dition has lasted or can be expected to last continu- ously for at least a year or can lead to death.

Examples 1 and 2, next, show situations in which the individuals are considered engaged in a substan- tial gainful activity. Example 3 shows a person who might not be considered engaged in a substantial gainful activity. In each example, the person was un- der age 65 at the end of the year.

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Income Limits for the Credit for the Elderly or the Disabled THEN you generally cannot take the credit if:

IF you are . . .

The amount on Form 1040A, line 22, or Form 1040, line 38, is . . . Or you received . . .

Single, head of household, or qualifying widow(er) with dependent child

$17,500 or more $5,000 or more of nontaxable social security or other nontaxable pensions, annuities, or disability income

Married filing jointly and only one spouse is eligible for the credit

$20,000 or more $5,000 or more of nontaxable social security or other nontaxable pensions, annuities, or disability income

Married filing jointly and both spouses are eligible for the credit

$25,000 or more $7,500 or more of nontaxable social security or other nontaxable pensions, annuities, or disability income

Married filing separately and you lived apart from your spouse for all of 2012

$12,500 or more $3,750 or more of nontaxable social security or other nontaxable pensions, annuities, or disability income

Example 1. Sue retired on disability as a sales clerk. She now works as a full-time babysitter earn- ing minimum wage. Although she does different work, Sue babysits on ordinary terms for the mini- mum wage. She cannot take the credit because she is engaged in a substantial gainful activity. Example 2. Mary, the president of XYZ Corpora- tion, retired on disability because of her terminal ill- ness. On her doctor's advice, she works part time as a manager and is paid more than the minimum wage. Her employer sets her days and hours. Although Mary's illness is terminal and she works part time, the work is done at her employer's convenience. Mary is considered engaged in a substantial gainful activity and cannot take the credit. Example 3. John, who retired on disability, took a job with a former employer on a trial basis. The pur- pose of the job was to see if John could do the work. The trial period lasted for some time during which John was paid at a rate equal to the minimum wage. But because of John's disability, he was given only light duties of a nonproductive, make-work nature. Unless the activity is both substantial and gainful, John is not engaged in a substantial gainful activity. The activity was gainful because John was paid at a rate at or above the minimum wage. However, the activity was not substantial because the duties were of a nonproductive, make-work nature. More facts are needed to determine if John is able to engage in a substantial gainful activity.

Disability Income Generally, disability income is the total amount you were paid under your employer's accident and health plan or pension plan that is included in your income as wages or payments instead of wages for the time you were absent from work because of permanent

and total disability. However, any payment you re- ceived from a plan that does not provide for disabili- ty retirement is not disability income.

In figuring the credit, disability income does not include any amount you received from your employ- er's pension plan after you have reached mandatory retirement age.

For more details on disability income, see Pub. 525.

Part II. Statement of Permanent and Total Disability If you checked box 2, 4, 5, 6, or 9 in Part I and you did not file a physician's statement for 1983 or an earlier year, or you filed or got a statement for tax years after 1983 and your physician signed on line A of the statement, you must have your physician com- plete a statement certifying that:

You were permanently and totally disabled on the date you retired, or

If you retired before 1977, you were permanent- ly and totally disabled on January 1, 1976, or Janu- ary 1, 1977.

You do not have to file this statement with your tax return. But you must keep it for your records. You can use the physician's statement later in these instructions for this purpose. Your physician should show on the statement if the disability has lasted or can be expected to last continuously for at least a year, or if there is no reasonable probability that the disabled condition will ever improve. If you file a joint return and you checked box 5 in Part I, you and your spouse must each get a statement.

If you filed a physician's statement for 1983 or an earlier year, or you filed or got a statement for tax

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years after 1983 and your physician signed on line B of the statement, you do not have to get another statement for 2012. But you must check the box on line 2 in Part II to certify all three of the following.

1. You filed or got a physician's statement in an earlier year.

2. You were permanently and totally disabled during 2012.

3. You were unable to engage in any substantial gainful activity during 2012 because of your physi- cal or mental condition.

If you checked box 4, 5, or 6 in Part I, enter in the space above the box on line 2 in Part II the first name(s) of the spouse(s) for whom the box is checked.

If the Department of Veterans Affairs (VA) certi- fies that you are permanently and totally disabled, you can use VA Form 21-0172 instead of the physi- cian's statement. VA Form 21-0172 must be signed by a person authorized by the VA to do so. You can get this form from your local VA regional office.

Part III. Figure Your Credit Line 11 If you checked box 2, 4, 5, 6, or 9 in Part I, use the following chart to complete line 11.

IF you checked . . . THEN enter on line 11 . . . Box 6 The total of $5,000 plus the

disability income you reported on Form 1040A or 1040 for the spouse who was under age 65.

Box 2, 4, or 9 The total amount of disability income you reported on Form 1040A or 1040.

Box 5 The total amount of disability income you reported on Form 1040A or 1040 for both you and your spouse.

Example 1. Bill, age 63, retired on permanent and total disability in 2012. He received $4,000 of taxa-

ble disability income that he reports on Form 1040, line 7. He is filing jointly with his wife who was age 67 in 2012, and he checked box 6 in Part I. On line 11, Bill enters $9,000 ($5,000 plus the $4,000 of disability income he reports on Form 1040, line 7). Example 2. John checked box 2 in Part I and enters $5,000 on line 10. He received $3,000 of taxable disability income, which he enters on line 11. John also enters $3,000 on line 12 (the smaller of line 10 or line 11). The largest amount he can use to figure the credit is $3,000.

Lines 13a Through 18 The amount on which you figure your credit can be reduced if you received certain types of nontaxable pensions, annuities, or disability income. The amount can also be reduced if your adjusted gross income is over a certain amount, depending on which box you checked in Part I. Line 13a. Enter any social security benefits (before deduction of Medicare premiums) you (and your spouse if filing jointly) received for 2012 that are not taxable. Also, enter any tier 1 railroad retirement benefits treated as social security that are not taxa- ble.

If any of your social security or equivalent rail- road retirement benefits are taxable, the amount to enter on this line is generally the difference between the amounts entered on Form 1040A, line 14a and line 14b, or Form 1040, line 20a and line 20b.

If your social security or equivalent railroad retirement benefits are reduced because of workers' compensation benefits, treat the

workers' compensation benefits as social security benefits when completing Schedule R (Form 1040A or 1040), line 13a.

Line 13b. Enter the total of the following types of income that you (and your spouse if filing jointly) received for 2012.

Veterans' pensions (but not military disability pensions).

Any other pension, annuity, or disability benefit that is excluded from income under any provision of federal law other than the Internal Revenue Code. Do not include amounts that are treated as a return of your cost of a pension or annuity.

CAUTION !

Credit Limit Worksheet—Line 21 Keep for Your Records Use this worksheet to figure your credit limit.

1. Enter the amount from Form 1040A, line 28; or Form 1040, line 46 . . . . . . . . . . . . . . . . . . . . . . . . . . . 1. 2. Enter the amount from Form 1040A, line 29; or Form 1040, lines 47 and 48 . . . . . . . . . . . . . . . . . . . . 2. 3. Subtract line 2 from line 1. Enter this amount on Schedule R (Form 1040A or 1040), line 21. But if

zero or less, STOP, you cannot take this credit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.

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Do not include on line 13b any pension, annuity, or similar allowance for personal injuries or sickness

resulting from active service in the armed forces of any country, or in the National Oceanic and Atmos- pheric Administration or the Public Health Service. Also, do not include a disability annuity payable un- der section 808 of the Foreign Service Act of 1980.

Instructions for Physician's Statement Taxpayer Physician If you retired after 1976, enter the date you retired in the space provided on the statement below.

A person is permanently and totally disabled if both of the following apply.

1. He or she cannot engage in any substantial gainful activity because of a physical or mental condition.

2. A physician determines that the disability has lasted or can be expected to last continuously for at least a year or can lead to death.

Physician's Statement Keep for Your Records I certify that

Name of disabled person

was permanently and totally disabled on January 1, 1976, or January 1, 1977, or was permanently and totally disabled on the

date he or she retired. If retired after 1976, enter the date retired. ▶ Physician: Sign your name on either line A or B below.

A The disability has lasted or can be expected to last continuously for at least a year . . . . . . .

Physician's signature Date B There is no reasonable probability that the

disabled condition will ever improve . . . . . . . . Physician's signature Date

Physician's name Physician's address

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Department of the Treasury Internal Revenue Service

2012 Instructions for Schedule SE (Form 1040) Self-Employment Tax

Use Schedule SE (Form 1040) to figure the tax due on net earnings from self-employ- ment. The Social Security Administration uses the information from Schedule SE to figure your benefits under the social security program. This tax applies no matter how old you are and even if you are already getting social security or Medicare benefits. Additional information. See Pub. 225 or Pub. 334.

Section references are to the Internal Revenue Code unless otherwise noted.

Future Developments For the latest information about devel- opments related to Schedule SE (Form 1040) and its instructions, such as legis- lation enacted after they were published, go to www.irs.gov/form1040.

What's New Maximum income subject to social se­ curity tax. For 2012, the maximum amount of self-employment income sub- ject to social security tax is $110,100.

General Instructions Who Must File Schedule SE You must file Schedule SE if:

The amount on line 4 of Short Schedule SE or line 4c of Long Sched- ule SE is $400 or more, or

You had church employee income of $108.28 or more. Income from serv- ices you performed as a minister or a member of a religious order is not church employee income. See Employ­ ees of Churches and Church Organiza­ tions. Note. Even if you had a loss or a small amount of income from self-employ- ment, it may be to your benefit to file Schedule SE and use either "optional method" in Part II of Long Schedule SE (discussed later). Exception. If your only self-employ- ment income was from earnings as a minister, member of a religious order, or Christian Science practitioner, see Min­ isters and Members of Religious Orders.

Who Must Pay Self-Employment (SE) Tax Self-Employed Persons You must pay SE tax if you had net earnings of $400 or more as a self-em- ployed person. If you are in business (farm or nonfarm) for yourself, you are self-employed.

You must also pay SE tax on your share of certain partnership income and your guaranteed payments. See Partner­ ship Income or Loss, later.

Employees of Churches and Church Organizations If you had church employee income of $108.28 or more, you must pay SE tax. Church employee income is wages you received as an employee (other than as a minister or member of a religious order) of a church or qualified church-control- led organization that has a certificate in effect electing an exemption from em- ployer social security and Medicare tax- es.

Ministers and Members of Religious Orders In most cases, you must pay SE tax on salaries and other income for services you performed as a minister, a member of a religious order who has not taken a vow of poverty, or a Christian Science practitioner. But if you filed Form 4361 and received IRS approval, you will be exempt from paying SE tax on those net earnings. If you had no other income subject to SE tax, enter “Exempt—Form 4361” on Form 1040, line 56, or Form 1040NR, line 54. However, if you had other earnings of $400 or more subject to SE tax, see line A at the top of Long Schedule SE.

If you have ever filed Form 2031 to elect social security coverage on your earnings as

a minister, you cannot revoke that elec­ tion.

If you must pay SE tax, include this income on either Short or Long Sched- ule SE, line 2. But do not report it on Long Schedule SE, line 5a; it is not con- sidered church employee income. Also, include on line 2:

The rental value of a home or an allowance for a home furnished to you (including payments for utilities), and

The value of meals and lodging provided to you, your spouse, and your dependents for your employer's conven- ience.

However, do not include on line 2: Retirement benefits you received

from a church plan after retirement, or The rental value of a home or an

allowance for a home furnished to you (including payments for utilities) after retirement.

If you were a duly ordained minister who was an employee of a church and you must pay SE tax, the unreimbursed business expenses that you incurred as a church employee are allowed only as an itemized deduction for income tax pur- poses. However, when figuring SE tax, subtract on line 2 the allowable expenses from your self-employment earnings and attach an explanation.

If you were a U.S. citizen or resident alien serving outside the United States as a minister or member of a religious order and you must pay SE tax, you can- not reduce your net earnings by the for- eign earned income exclusion or the for- eign housing exclusion or deduction.

See Pub. 517 for details.

CAUTION !

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Members of Certain Religious Sects If you have conscientious objections to social security insurance because of your membership in and belief in the teachings of a religious sect recognized as being in existence at all times since December 31, 1950, and which has pro- vided a reasonable level of living for its dependent members, you are exempt from SE tax if you received IRS appro- val by filing Form 4029. In this case, do not file Schedule SE. Instead, enter “Ex- empt—Form 4029” on Form 1040, line 56, or Form 1040NR, line 54. See Pub. 517 for details.

U.S. Citizens Employed by Foreign Governments or International Organizations You must pay SE tax on income you earned as a U.S. citizen employed by a foreign government (or, in certain cases, by a wholly owned instrumentality of a foreign government or an international organization under the International Or- ganizations Immunities Act) for services performed in the United States, Puerto Rico, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, or the U.S. Virgin Islands. Re- port income from this employment on either Short or Long Schedule SE, line 2. If you performed services else- where as an employee of a foreign gov- ernment or an international organization, those earnings are exempt from SE tax. Exception—Dual citizens. A person with dual U.S.-foreign citizenship is generally considered to be a U.S. citizen for social security purposes. However, if you are a U.S. citizen and also a citizen of a country with which the United States has a bilateral social security agreement, other than Canada or Italy, your work for the government of that foreign country is always exempt from U.S. social security taxes. For further in- formation about these agreements, see the exception shown in the next section.

U.S. Citizens or Resident Aliens Living Outside the United States If you are a self-employed U.S. citizen or resident alien living outside the Uni- ted States, in most cases you must pay SE tax. You cannot reduce your foreign

earnings from self-employment by your foreign earned income exclusion. Exception. The United States has social security agreements with many countries to eliminate dual taxes under two social security systems. Under these agree- ments, you must generally pay social se- curity and Medicare taxes to only the country you live in.

The United States now has social se- curity agreements with the following countries: Australia, Austria, Belgium, Canada, Chile, Czech Republic, Den- mark, Finland, France, Germany, Greece, Ireland, Italy, Japan, Luxem- bourg, the Netherlands, Norway, Poland, Portugal, South Korea, Spain, Sweden, Switzerland, and the United Kingdom. Additional agreements are expected in the future.

If you have questions about interna- tional social security agreements, you can:

1. Visit the Social Security Adminis- tration's (SSA's) International Programs website at www.socialsecurity.gov/inter­ national;

2. Call the SSA's Office of Interna- tional Programs at:

a. (410) 965-3322 for questions on benefits under agreements, or

b. (410) 965-7306 for questions on the coverage rules of the agreements; or

3. Write to:

a. Social Security Administration, Office of International Programs, P.O. Box 17741, Baltimore, MD 21235-7741 USA for information about an agree- ment, or

b. Social Security Administration, OIO—Totalization, P.O. Box 17769, Baltimore, MD 21235-7769 USA for in- formation about a claim for benefits.

If your self-employment income is exempt from SE tax, you should get a statement from the appropriate agency of the foreign country verifying that your self-employment income is subject to social security coverage in that coun- try. If the foreign country will not issue the statement, contact the SSA at the ad- dress shown in (3a) above. Do not com- plete Schedule SE. Instead, attach a copy of the statement to Form 1040 and enter “Exempt, see attached statement” on Form 1040, line 56.

Nonresident Alien If you are a self-employed nonresident alien living in the United States, you must pay SE tax if an international so- cial security agreement in effect deter- mines that you are covered under the U.S. social security system. See Excep­ tion under U.S. Citizens or Resident Ali­ ens Living Outside the United States, earlier, for information about interna- tional social security agreements. If your self-employment income is subject to SE tax, complete Schedule SE and file it with your Form 1040NR.

Chapter 11 Bankruptcy Cases While you are a debtor in a chapter 11 bankruptcy case, your net profit or loss from self-employment (for example, from Schedule C or Schedule F) will not be included in your Form 1040 income. Instead, it will be included on the in- come tax return (Form 1041) of the bankruptcy estate. However, you (not the bankruptcy estate) are responsible for paying SE tax on your net earnings from self-employment.

Enter on the dotted line to the left of Schedule SE, line 3, “Chap. 11 bank- ruptcy income” and the amount of your net profit or (loss). Combine that amount with the total of lines 1a, 1b, and 2 (if any) and enter the result on line 3.

For other reporting requirements, see Chapter 11 Bankruptcy Cases in the in- structions for Form 1040.

More Than One Business If you had two or more businesses, your net earnings from self-employment are the combined net earnings from all of your businesses. If you had a loss in one business, it reduces the income from an- other. Figure the combined SE tax on one Schedule SE.

Joint Returns Show the name of the spouse with self-employment income on Sched- ule SE. If both spouses have self-em- ployment income, each must file a sepa- rate Schedule SE. However, if one spouse qualifies to use Short Sched- ule SE (front of form) and the other must use Long Schedule SE (back of form), both can use the same form. One spouse should complete the front and the other the back.

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Include the total profits or losses from all businesses on Form 1040. Enter the combined SE tax on Form 1040, line 56.

Community Income If any of the income from a business (in- cluding farming) is community income, then the income and deductions are re- ported based on the following.

If only one spouse participates in the business, all of the income from that business is the self-employment earn- ings of the spouse who carried on the business.

If both spouses participate, the in- come and deductions are allocated to the spouses based on their distributive shares.

If either or both you and your spouse are partners in a partnership, see Partnership Income or Loss, later.

If you and your spouse elected to treat the business as a qualifying joint venture, see Qualified Joint Ventures, later. Married filing separately. If you and your spouse had community income and file separate returns, attach Schedule SE to the return of the spouse with the self-employment income. Also, attach Schedule(s) C, C-EZ, or F (showing the spouse's share of community income and expenses) to the return of each spouse.

If you are the spouse who carried on the business, you must include on Schedule SE, line 3, the net profit or (loss) reported on the other spouse's Schedule C, C-EZ, or F (except in those cases described later under Income and Losses Not Included in Net Earnings From Self­Employment). Enter on the dotted line to the left of Schedule SE, line 3, “Community income taxed to spouse” and the amount of any net profit or (loss) allocated to your spouse as community income. Combine that amount with the total of lines 1a, 1b, and 2 and enter the result on line 3.

If you are not the spouse who carried on the business and you had no other in- come subject to SE tax, enter “Exempt community income” on Form 1040, line 56, or Form 1040NR, line 54. Do not file Schedule SE. However, if you had $400 or more of other earnings sub- ject to SE tax, include on Schedule SE, line 1a or 2, the net profit or (loss) from

Schedule(s) C, C-EZ, or F allocated to you as community income. Also, enter on the dotted line to the left of Sched- ule SE, line 3, “Exempt community in- come” and the allocated amount. If that amount is a net profit, subtract it from the total of lines 1a, 1b, and 2, and enter the result on line 3. If that amount is a loss, treat it as a positive amount, add it to the total of lines 1a, 1b, and 2, and en- ter the result on line 3.

Community income included on Schedule(s) C, C­EZ, or F must be divided for income tax

purposes based on the community prop­ erty laws of your state. See Pub. 555 for more information.

Qualified Joint Ventures If you and your spouse materially partic- ipate (see Material participation in the 2012 Instructions for Schedule C) as the only members of a jointly owned and operated business, and you file a joint return for the tax year, you can make a joint election to be taxed as a qualified joint venture instead of a partnership.

To make this election, you must di- vide all items of income, gain, loss, de- duction, and credit attributable to the business between you and your spouse in accordance with your respective inter- ests in the venture. Each of you must file a separate Schedule C, C-EZ, or F. On each line of your separate Schedule C, C-EZ, or F, you must enter your share of the applicable income, deduction, or loss. Each of you also must file a sepa- rate Schedule SE to pay SE tax, as appli- cable.

For more information on qualified joint ventures, go to IRS.gov. Enter “qualified joint venture” in the search box and select “Election for Husband and Wife Unincorporated Businesses.” Rental real estate business. If you and your spouse make the election for your rental real estate business, the income generally is not subject to SE tax. To in- dicate that election, be sure to check the “QJV” box in Part I, line 2, of each Schedule E that the rental property is lis- ted on. Do not file Schedule SE unless you have other income subject to SE tax. For an exception to this income not be- ing subject to SE tax, see item 3 under Other Income and Losses Included in

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Net Earnings From Self­Employment, later).

If the election is made for a farm rental business that is not included in self-employment, file two Forms 4835, Farm Rental Income and Expenses.

Fiscal Year Filers If your tax year is a fiscal year, use the tax rate and earnings base that apply at the time the fiscal year begins. Do not prorate the tax or earnings base for a fis- cal year that overlaps the date of a rate or earnings base change.

Line Instructions Read the flowchart on page 1 of Sched- ule SE to see if you can use Section A—Short Schedule SE, or if you must use Section B—Long Schedule SE. For either section, you will need to know what your net earnings from self-em- ployment are. To find out what is inclu- ded as net earnings from self-employ- ment, see Net Earnings From Self­Em­ ployment.

Enter all negative amounts in parentheses.

You Have Only Church Employee Income Subject to SE Tax If your only income subject to SE tax is church employee income (described ear- lier under Employees of Churches and Church Organizations), skip lines 1 through 4b. Enter -0- on line 4c and go to line 5a.

Note. Income from services you per- form as a minister or member of a reli- gious order is not church employee in- come.

Line 1b (Short or Long Schedule SE) If you were receiving social security re- tirement or social security disability benefits at the time you received your Conservation Reserve Program (CRP) payment(s), enter the amount of your taxable CRP payment(s) on line 1b. These payments are included on Sched- ule F, line 4b, or listed on Schedule K-1 (Form 1065), box 20, code Y.

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Line 4 (Short Schedule SE) If line 4 is less than $400 and you have an amount on line 1b, combine lines 1a and 2.

If the total of lines 1a and 2 is $434 or more, file Schedule SE (completed through line 4) with your tax return. En- ter -0- on Form 1040, line 56, or Form 1040NR, line 54.

If the total of lines 1a and 2 is less than $434, do not file Schedule SE un- less you choose to use an optional meth- od for figuring your SE tax.

Lines 4a Through 4c (Long Schedule SE) If both lines 4a and 4c are less than $400 and you have an amount on line 1b, combine lines 1a and 2.

If the total of lines 1a and 2 is $434 or more, file Schedule SE (completed through line 4c) with your tax return. Enter -0- on Form 1040, line 56,* or Form 1040NR, line 54.*

If the total of lines 1a and 2 is less than $434, do not file Schedule SE un- less you choose to use an optional meth- od to figure your SE tax. *If you also have church employee in­ come (described earlier under Employ- ees of Churches and Church Organiza- tions), also complete lines 5a and 5b. Complete the rest of Schedule SE, as ap­ propriate.

Net Earnings From Self-Employment In most cases, net earnings include your net profit from a farm or nonfarm busi- ness.

Partnership Income or Loss If you were a general or limited partner in a partnership, include on line 1a or line 2, whichever applies, the amount of net earnings from self-employment from Schedule K-1 (Form 1065), box 14, code A, and Schedule K-1 (Form 1065-B), box 9, code J1. General part- ners should reduce this amount by cer- tain expenses before entering it on Schedule SE. See your Schedule K-1 in- structions. If you reduce the amount you enter on Schedule SE, you must attach an explanation. Limited partners include only guaranteed payments for services actually rendered to or on behalf of the partnership.

If a partner died and the partnership continued, include in self-employment income the deceased's distributive share of the partnership's ordinary income or loss through the end of the month in which he or she died. See section 1402(f).

If you were married and both you and your spouse were partners in a partner- ship, each of you must report your net earnings from self-employment from the partnership. Each of you must file a sep- arate Schedule SE and report the part- nership income or loss on Schedule E (Form 1040), Part II, for income tax pur- poses. If only one of you was a partner in a partnership, the spouse who was the partner must report his or her net earn- ings from self-employment from the partnership. Community income. Your own distrib- utive share of partnership income is in- cluded in figuring your net earnings from self-employment. Unlike the divi- sion of that income between spouses for figuring income tax, no part of your share can be included in figuring your spouse's net earnings from self-employ- ment.

Share Farming You are considered self-employed if you produced crops or livestock on someone else's land for a share of the crops or livestock produced (or a share of the proceeds from the sale of them). This applies even if you paid another person (an agent) to do the actual work or man- agement for you. Report your net earn- ings for income tax purposes on Sched- ule F (Form 1040) and for SE tax purpo- ses on Schedule SE. See Pub. 225 for details.

Other Income and Losses Included in Net Earnings From Self-Employment

1. Rental income from a farm if, as landlord, you materially participated in the production or management of the production of farm products on this land. This income is farm earnings. To determine whether you materially par- ticipated in farm management or pro- duction, do not consider the activities of any agent who acted for you. The mate- rial participation tests for landlords are explained in chapter 12 of Pub. 225.

2. Cash or a payment-in-kind from the Department of Agriculture for par- ticipating in a land diversion program.

3. Payments for the use of rooms or other space when you also provided sub- stantial services for the convenience of your tenants. Examples are hotel rooms, boarding houses, tourist camps or homes, trailer parks, parking lots, ware- houses, and storage garages. See chap- ter 5 of Pub. 334 for more information.

4. Income from the retail sale of newspapers and magazines if you were age 18 or older and kept the profits.

5. Income you receive as a direct sell- er. Newspaper carriers or distributors of any age are direct sellers if certain con- ditions apply. See chapter 5 of Pub. 334 for details.

6. Amounts received by current or former self-employed insurance agents and salespersons that are:

a. Paid after retirement but figured as a percentage of commissions received from the paying company before retire- ment,

b. Renewal commissions, or c. Deferred commissions paid after

retirement for sales made before retire- ment.

However, certain termination pay- ments received by former insurance salespersons are not included in net earnings from self-employment (as ex- plained in item 10 under Income and Losses Not Included in Net Earnings From Self­Employment).

7. Income of certain crew members of fishing vessels with crews of normal- ly fewer than 10 people. See chapter 10 of Pub. 334 for details.

8. Fees as a state or local government employee if you were paid only on a fee basis and the job was not covered under a federal-state social security coverage agreement.

9. Interest received in the course of any trade or business, such as interest on notes or accounts receivable.

10. Fees and other payments received by you for services as a director of a corporation.

11. Recapture amounts under sections 179 and 280F that you included in gross income because the business use of the property dropped to 50% or less. Do not

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include amounts you recaptured on the disposition of property. See Form 4797.

12. Fees you received as a professio- nal fiduciary. This may also apply to fees paid to you as a nonprofessional fi- duciary if the fees relate to active partic- ipation in the operation of the estate's business, or the management of an estate that required extensive management ac- tivities over a long period of time.

13. Gain or loss from section 1256 contracts or related property by an op- tions or commodities dealer in the nor- mal course of dealing in or trading sec- tion 1256 contracts.

Income and Losses Not Included in Net Earnings From Self-Employment

1. Salaries, fees, etc., subject to social security or Medicare tax that you re- ceived for performing services as an em- ployee, including services performed as an employee under the railroad retire- ment system. This includes services per- formed as a public official (except as a fee basis government employee as ex- plained in item 8 under Other Income and Losses Included in Net Earnings From Self­Employment, earlier).

2. Fees received for services per- formed as a notary public. If you had no other income subject to SE tax, enter “Exempt—Notary” on Form 1040, line 56. Do not file Schedule SE. How- ever, if you had other earnings of $400 or more subject to SE tax, enter “Ex- empt—Notary” and the amount of your net profit as a notary public from Sched- ule C or Schedule C-EZ on the dotted line to the left of Schedule SE, line 3. Subtract that amount from the total of lines 1a, 1b, and 2, and enter the result on line 3.

3. Income you received as a retired partner under a written partnership plan that provides for lifelong periodic retire- ment payments if you had no other inter- est in the partnership and did not per- form services for it during the year.

4. Income from real estate rentals if you did not receive the income in the course of a trade or business as a real es- tate dealer. Report this income on Schedule E.

5. Income from farm rentals (includ- ing rentals paid in crop shares) if, as

landlord, you did not materially partici- pate in the production or management of the production of farm products on the land. See chapter 12 of Pub. 225 for de- tails. Report this income on Form 4835. Use two Forms 4835 if you and your spouse made an election to be taxed as a qualified joint venture.

6. Payments you receive from the Conservation Reserve Program if you are receiving social security benefits for retirement or disability. Deduct these payments on line 1b of Schedule SE.

7. Dividends on shares of stock and interest on bonds, notes, etc., if you did not receive the income in the course of your trade or business as a dealer in stocks or securities.

8. Gain or loss from:

a. The sale or exchange of a capital asset;

b. The sale, exchange, involuntary conversion, or other disposition of prop- erty unless the property is stock in trade or other property that would be includi- ble in inventory, or held primarily for sale to customers in the ordinary course of the business; or

c. Certain transactions in timber, coal, or domestic iron ore.

9. Net operating losses from other years.

10. Termination payments you re- ceived as a former insurance salesperson if all of the following conditions are met.

a. The payment was received from an insurance company because of services you performed as an insurance salesper- son for the company.

b. The payment was received after termination of your agreement to per- form services for the company.

c. You did not perform any services for the company after termination and before the end of the year in which you received the payment.

d. You entered into a covenant not to compete against the company for at least a 1-year period beginning on the date of termination.

e. The amount of the payment depen- ded primarily on policies sold by or credited to your account during the last year of the agreement, or the extent to

which those policies remain in force for some period after termination, or both.

f. The amount of the payment did not depend to any extent on length of serv- ice or overall earnings from services performed for the company (regardless of whether eligibility for the payment depended on length of service).

Statutory Employee Income If you were a statutory employee, do not include the net profit or (loss) from Schedule C, line 31 (or the net profit from Schedule C-EZ, line 3), on Short or Long Schedule SE, line 2. But if you file Long Schedule SE, be sure to in- clude statutory employee social security wages and tips from Form W-2 on line 8a.

Optional Methods How Can the Optional Methods Help You Social security coverage. The optional methods may give you credit toward your social security coverage even though you have a loss or a small amount of income from self-employ- ment. Earned income credit (EIC). Using the optional methods may qualify you to claim the EIC or give you a larger credit if your net earnings from self-employ- ment (determined without using the op- tional methods) are less than $4,520. Figure the EIC with and without using the optional methods to see if the op- tional methods will benefit you. Additional child tax credit. Using the optional methods may qualify you to claim the additional child tax credit or give you a larger credit if your net earn- ings from self-employment (determined without using the optional methods) are less than $4,520. Figure the additional child tax credit with and without using the optional methods to see if the op- tional methods will benefit you. Child and dependent care credit. The optional methods may help you qualify for this credit or give you a larger credit if your net earnings from self-employ- ment (determined without using the op- tional methods) are less than $4,520. Figure this credit with and without using the optional methods to see if the op- tional methods will benefit you.

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Self­employed health insurance de­ duction. The optional methods of com- puting net earnings from self-employ- ment may be used to figure your self-employed health insurance deduc- tion.

Using the optional methods may give you the benefits de­ scribed above, but they may al­

so increase your SE tax.

Changing Your Method You can change the method after you file your return. That is, you can change from the regular to the optional method or from the optional to the regular meth- od. To do this, file Form 1040X.

Farm Optional Method You may use this method to figure your net earnings from farm self-employment if your gross farm income was $6,780 or less or your net farm profits were less than $4,894. Net farm profits are:

The total of the amounts from Schedule F (Form 1040), line 34, and Schedule K-1 (Form 1065), box 14, code A, minus

The amount you would have en- tered on Schedule SE, line 1b, had you not used the optional method.

There is no limit on how many years you can use this method.

Under this method, report in Part II, line 15, two-thirds of your gross farm in- come, up to $4,520, as your net earn- ings. This method can increase or de- crease your net earnings from farm self-employment even if the farming business had a loss.

For a farm partnership, figure your share of gross income based on the part- nership agreement. With guaranteed payments, your share of the partnership's gross income is your guaranteed pay- ments plus your share of the gross in- come after it is reduced by all guaran- teed payments made by the partnership. If you were a limited partner, include only guaranteed payments for services you actually rendered to or on behalf of the partnership.

Nonfarm Optional Method You may be able to use this method to figure your net earnings from nonfarm

CAUTION !

self-employment if your net nonfarm profits were less than $4,894 and also less than 72.189% of your gross non- farm income. Net nonfarm profits are the total of the amounts from:

Schedule C (Form 1040), line 31, Schedule C-EZ (Form 1040),

line 3, Schedule K-1 (Form 1065),

box 14, code A (from other than farm partnerships), and

Schedule K-1 (Form 1065-B), box 9, code J1.

To use this method, you also must be regularly self-employed. You meet this requirement if your actual net earnings from self-employment were $400 or more in 2 of the 3 years preceding the year you use the nonfarm optional meth- od. The net earnings of $400 or more could be from either farm or nonfarm earnings or both. The net earnings in- clude your distributive share of partner- ship income or loss subject to SE tax.

Use of the nonfarm optional method from nonfarm self-employment is limi- ted to 5 years. The 5 years do not have to be consecutive.

Under this method, report in Part II, line 17, two-thirds of your gross non- farm income, up to the amount on line 16, as your net earnings. But you cannot report less than your actual net earnings from nonfarm self-employ- ment.

Figure your share of gross income from a nonfarm partnership in the same manner as a farm partnership. See Farm Optional Method for details.

Using Both Optional Methods If you can use both methods, you can re- port less than your total actual net earn- ings from farm and nonfarm self-em- ployment, but you cannot report less than your actual net earnings from non- farm self-employment alone.

If you use both methods to figure net earnings, you cannot report more than $4,520 of net earnings from self-em- ployment.

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