2004 Instructions for Form 1040 (ALL) - Supreme Law Firm

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Form 1040—Lines 30 Through 34b be used to figure the deduction. For exam- • You are using amounts paid for quali- Line 30 ple, if you were eligible to participate in a fied long-term care insurance to figure the subsidized health plan maintained by your One-Half of spouse’s employer from September 30 Self-Employment Tax through December 31, you cannot use amounts paid for health insurance coverage for September through December to figure your deduction. For more details, see Pub. 535. deduction. If you were self-employed and owe Line 32 self-employment tax, fill in Schedule SE to figure the amount of your deduction. Line 31 Note. If, during 2004, you were an eligible trade adjustment assistance (TAA) recipient, alternative TAA recipient, or Pension Benefit Guaranty Corporation pension re- Self-Employed Health 517. Insurance Deduction cipient, you must complete Form 8885 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. You may be able to deduct the amount you before completing the worksheet below. paid for health insurance for yourself, your When figuring the amount to enter on line 1 of the worksheet below, do not include any Line 33 spouse, and your dependents if any of the following apply. health coverage tax credit advance pay- Penalty on Early Withdrawal ments shown in Form 1099-H, box 1. Also, • You were self-employed and had a net subtract the amount shown on Form 8885, of Savings profit for the year. line 4, (reduced by any advance payments The Form 1099-INT or Form 1099-OID • You used one of the optional methods shown on line 6 of that form) from the total you received will show the amount of any to figure your net earnings from self-em- insurance premiums you paid. penalty you were charged. ployment on Schedule SE. • You received wages in 2004 from an If you qualify to take the deduction, use S corporation in which you were a the worksheet below to figure the amount Lines 34a and 34b If you made payments to or for your spouse or former spouse under a divorce or separa- tion instrument, you may be able to take this deduction. Use TeleTax topic 452 (see page 8) or see Pub. 504. more-than-2% shareholder. Health insurance benefits paid for you may be shown in Form W-2, box 14. The insurance plan must be established under your business. But if you were also eligible to participate in any subsidized health plan maintained by your or your spouse’s employer for any month or part of a month in 2004, amounts paid for health insurance coverage for that month cannot you can deduct. Exception. Use Pub. 535 instead of the worksheet below to find out how to figure your deduction if any of the following apply. • You had more than one source of income subject to self-employment tax. • You file Form 2555 or 2555-EZ. Alimony Paid Self-Employed Health Insurance Deduction Worksheet—Line 31 Keep for Your Records Before you begin: Complete Form 1040, line 32, if it applies to you. If, during 2004, you were an eligible trade adjustment assistance (TAA) recipient, alternative TAA recipient, or Pension Benefit Guaranty Corporation pension recipient, see the Note above. Be sure you have read the Exception above to see if you can use this worksheet instead of Pub. 535 to figure your deduction. 1. Enter the total amount paid in 2004 for health insurance coverage established under your business for 2004 for you, your spouse, and your dependents. But do not include amounts for any month you were eligible to participate in an employer-sponsored health plan ......................... 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 30 and 32 ................... 2. 3. Self-employed health insurance deduction. Enter the smaller of line 1 or line 2 here and on Form 1040, line 31. 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, line 4b. ** Earned income includes net earnings and gains from the sale, transfer, or licensing of property you created. 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 wages from that corporation. Need more information or forms? See page 7. -30-
Line 35 Include in the total on line 35 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 35, enter the amount of your Form 1040—Lines 35 Through 39 3. Is designed to be propelled by a above, you can get a statement certified by clean-burning fuel, such as natural gas, liq- your eye doctor or registered optometrist to uefied natural gas, liquefied petroleum gas, this effect instead. hydrogen, or electricity. You must keep the statement for your A qualified clean-fuel vehicle includes records. certain gasoline-electric hybrid vehicles such as the Honda Insight, Honda Civic deduction and identify it as indicated. Hybrid, and Toyota Prius. It does not in- Line 38b You may be able to take a credit TIP if you placed a new electric vehicle in service in 2004. See Form 8834 for details. You may also be able to take this deduction for certain new property installed on a motor vehicle to enable it to be propelled by a clean-burning fuel. For more details, see Pub. 535. • Archer MSA deduction (see Form 8853). Identify as “MSA.” • Jury duty pay if you gave the pay to your employer because your employer paid your salary while you served on the jury. Identify as “Jury Pay.” • Deductible expenses related to income reported on line 21 from the rental of personal property engaged in for profit. Identify as “PPR.” • Reforestation amortization and expenses (see Pub. 535). Identify as “RFST.” • Repayment of supplemental unem- clude electric vehicles. If your spouse itemizes deductions on a separate return or if you were a dual-status alien, check the box on line 38b. But if you were a dual-status alien and you file a joint return with your spouse who was a U.S. citizen or resident at the end of 2004 and you and your spouse agree to be taxed on your combined worldwide income, do not check the box. Line 39 ployment benefits under the Trade Act of Line 36 Itemized Deductions or 1974 (see Pub. 525). Identify as “Sub-Pay If line 36 is less than zero, you may have a Standard Deduction TRA.” net operating loss that you can carry to • Contributions to section In most cases, your federal income tax will another tax year. See the Instructions for 501(c)(18)(D) pension plans (see Pub. be less if you take the larger of your item- Form 1045 for details. 525). Identify as “501(c)(18)(D).” ized deductions or standard deduction. • Contributions by certain chaplains to If you checked the box on line section 403(b) plans (see Pub. 517). Idenzero. 38b, your standard deduction is ! tify as “403(b).” Tax and Credits CAUTION • Attorney fees and court costs paid after October 22, 2004, for actions settled or Itemized Deductions decided after that date involving certain un- Line 38a To figure your itemized deductions, fill in TIP There are higher deduction amounts for heavy trucks, vans, and buses. A qualified clean-fuel vehicle: 1. Must be acquired new and for your own use. 2. Must satisfy any federal and state emissions standards. lawful discrimination claims, but only to the extent of gross income from such actions (see Pub. 525). Identify as “UDC.” • Deduction for clean-fuel vehicles. If you placed a qualified clean-fuel vehicle in service in 2004, you can deduct $2,000 on line 35 if you did not use the vehicle in your business (other than as an employee). Identify this deduction on line 35 as “Clean-Fuel.” If you used a qualified clean-fuel vehicle or other clean-fuel vehicle property in your business (other than as an employee), claim the business portion of the deduction on the applicable line of Schedule C, E, or F. If you were born before January 2, 1940, or were blind at the end of 2004, check the appropriate box(es) on line 38a. If you were married and checked the box on Form 1040, line 6b, and your spouse was born before January 2, 1940, or was blind at the end of 2004, also check the appropriate box(es) for your spouse. Be sure to enter the total number of boxes checked. Blindness If you were partially blind as of December 31, 2004, you must get a statement certified by your eye doctor or registered 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 Schedule A. Standard Deduction Most people can find their standard deduction by looking at the amounts listed under “All others” to the left of Form 1040, line 39. But if you, or your spouse if filing jointly, can be claimed as a dependent on someone’s 2004 return or you checked any box on line 38a, use the worksheet or the chart on page 32, whichever applies, to figure your standard deduction. Also, if you checked the box on line 38b, your standard deduction is zero, even if you were born before January 2, 1940, or were blind. Electing To Itemize for State Tax or Other Purposes If you itemize even though your itemized deductions are less than your standard deduction, enter “IE” on the dotted line next to line 39. -31- Need more information or forms? See page 7.
Page 1 and 2: Note. This booklet does not contain
Page 3 and 4: What is IRS e-file? It’s the fast
Page 5 and 6: Tax Return Page Reference Questions
Page 7 and 8: Quick and Easy Access to Tax Help a
Page 9 and 10: Topic TeleTax Topics No. Subject No
Page 11 and 12: Before You Fill In Form 1040 See Ho
Page 13 and 14: Chart B—For Children and Other De
Page 15 and 16: Form Item and Box in Which it Shoul
Page 17 and 18: Line 2 December 31, 2004, you were
Page 19 and 20: Form 1040—Lines 7 and 8a less tha
Page 21 and 22: gross income was over $139,500 ($69
Page 23 and 24: Form 1040—Lines 16a and 16b Age (
Page 25 and 26: Form 1040—Lines 20a and 20b Socia
Page 27 and 28: Form 1040—Line 25 IRA Deduction W
Page 29: Form 1040—Lines 27 Through 29 for
Page 33 and 34: Form 1040—Lines 41 and 43 Tax Tab
Page 35 and 36: Line 44 • Tax-exempt interest fro
Page 37 and 38: Line 51—Child Tax Credit What Is
Page 39 and 40: ured the credit. Check box c and en
Page 41 and 42: Lines 65a and 65b— Earned Income
Page 43 and 44: Form 1040—Lines 65a and 65b Conti
Page 45 and 46: Worksheet A—Earned Income Credit
Page 47 and 48: Form 1040—Lines 65a and 65b Works
Page 49 and 50: 2004 Earned Income Credit (EIC) Tab
Page 55 and 56: number is 20202086. Do not include
Page 57 and 58: You cannot sign your return are not
Page 59 and 60: site at www.aarp.org/taxaide or cal
Page 61 and 62: 2004 Tax Table—Continued If line
Page 71 and 72: If line 42 (taxable income) is— A
Page 73 and 74: Order Blank for Forms and Publicati
Page 75 and 76: Disclosure, Privacy Act, and Paperw
Page 77 and 78: Department of the Treasury Internal
Page 79 and 80: more than the general sales tax rat
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• You gave gifts of property that
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Instructions for Schedule B, after
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Department of the Treasury Internal
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ing the tax year, and you did not m
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also include the amount collected i
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line 36. The amount you can deduct
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Principal Business or Professional
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Partnership Interests vestment. Thi
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If there is an amount in box 1c, se
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sale of your main home if you are n
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follow the applicable instructions
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which you entered the combined tota
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If your rental real estate loss is
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gain results from redemption of the
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• Deducting the prepayment will n
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2001 Capital Gain Tax Worksheet—L
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2002 Tax Rate Schedules—Line 12 S
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2003 Tax Rate Schedules—Line 16 S
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homes, parking lots, warehouses, an
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Index to Instructions A Foreign Tax
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2004 Instructions for Form 1040 (ALL) - Supreme Law Firm

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