Department of the Treasury

Internal Revenue Service

Instructions for Form 1040-C

U.S. Departing Alien Income Tax Return
Privacy Act and Paperwork details, get Pub. 926, Employment Taxes Treaty Benefits
for Household Employers.
Reduction Act Notice If you take the position that a treaty of
Caution: At the time these instructions the United States overrides or modifies
We ask for the information on this form went to print, Congress was considering
to carry out the Internal Revenue laws of any provision of the Internal Revenue
legislation that would (1) increase the Code and that position reduces (or
the United States. Internal Revenue taxable part of U.S. social security
Code sections 6001, 6011, 6012(a), potentially reduces) your tax, you must
benefits received by nonresident aliens file Form 8833, Treaty-Based Return
6851, and their regulations require that after 1994 from 50% to 85%, (2) make
you give us the information. We need it Position Disclosure Under Section 6114
most nonresident aliens ineligible to or 7701(b), or similar statement, with
to ensure that you are complying with claim the earned income credit for 1995,
these laws and to allow us to figure and your final U.S. income tax return. For
and (3) require the reporting of social more details, see Pub. 519.
collect the right amount of tax. security numbers for dependents born
Routine uses of this information before November 1, 1995. For later
include giving it to the Department of information about this legislation, get Final Return Required
Justice for civil and criminal litigation Pub. 553, Highlights of 1994 Tax A Form 1040-C is not a final return. You
and to cities, states, and the District of Changes. must file a final income tax return after
Columbia to carry out their tax laws. If your tax year ends. If you are not a U.S.
you do not give the information asked Purpose of Form citizen or resident on the last day of the
for, you may be charged penalties and, year, file Form 1040NR. If you are a U.S.
in certain cases, you may be subject to Form 1040-C is used by aliens who citizen or resident on the last day of the
criminal prosecution. intend to leave the United States to year, you should file Form 1040. Any tax
report income they received or expect to you pay with Form 1040-C counts as a
The time needed to complete and file
receive for the entire year. credit against tax on your final return.
this form will vary depending on
individual circumstances. The estimated If you are a nonresident alien, use the Any overpayment shown on Form
average time is: Recordkeeping, 2 hr., 5 1994 Instructions for Form 1040NR, 1040-C will be refunded only if and to
min.; Learning about the law or the U.S. Nonresident Alien Income Tax the extent your final return for the tax
form, 44 min.; Preparing the form, 2 Return. Also, Pub. 519, U.S. Tax Guide year shows an overpayment.
hr., 19 min.; and Copying, assembling, for Aliens, and Pub. 901, U.S. Tax
and sending the form to the IRS, 1 hr., Treaties, will be helpful in filling in Form Certificate of Compliance
13 min. 1040-C.
If you are a resident alien, the 1994 Note: The issuance of a certificate of
If you have comments concerning the compliance is not a final determination
accuracy of these time estimates or Instructions for Form 1040, U.S.
Individual Income Tax Return, will help of your tax liability. If it is later
suggestions for making this form determined that there is a tax deficiency,
simpler, we would be happy to hear from you complete Form 1040-C.
you will have to pay the additional tax
you. You can write to both the Internal You can get copies of tax forms, due.
Revenue Service, Attention: Tax Forms instructions, and publications from the
Committee, PC:FP, Washington, DC Internal Revenue Service. If you have a Form 1040-C or Form 2063.—If you are
20224; and the Office of Management foreign address, send your order to an alien, you should not leave the United
and Budget, Paperwork Reduction either: Eastern Area Distribution Center, States or any of its possessions without
Project (1545-0086), Washington, DC P.O. Box 25866, Richmond, VA getting a certificate of compliance from
20503. DO NOT send the tax form to 23286-8107, USA; or Western Area your IRS District Director on Form
either of these offices. Instead, see How Distribution Center, Rancho Cordova, CA 1040-C or Form 2063, U.S. Departing
To Obtain the Certificate on page 2. 95743-0001, USA, whichever is closer. Alien Income Tax Statement. But see
Please order by publication or form Exceptions below. You may file the
number. shorter Form 2063 if you filed all U.S.
General Instructions Alien Status Rules.—If you are not a
income tax returns you were required to
file, you paid any tax due, and EITHER
citizen of the United States, specific 1 or 2 below applies to you.
Items To Note rules apply to determine if you are a
Payment of Employment Taxes for resident or nonresident alien. Intent is 1. You have no taxable income for the
Household Employees.—New rules not important in determining your year of departure and for the preceding
apply to the reporting and payment of residency status. You are considered a year if the time for filing the earlier year’s
employment taxes for household resident alien if you meet either the return has not passed.
employees. The rules eliminate the green card test or the substantial 2. You are a resident alien with taxable
quarterly filing and employment tax presence test. Even though you may income for the preceding year or for the
payment requirements and raise the $50 otherwise meet the substantial presence year of departure, but the District
per quarter threshold to $1,000 per year. test, you will not be considered a U.S. Director has decided that your leaving
For wages paid after 1994, you will be resident if you qualify for the closer will not hinder collecting the tax.
required to report social security, connection to a foreign country Exceptions. You do not need a
Medicare, Federal unemployment, and exception or you are able to qualify as a certificate of compliance if:
withheld Federal income taxes for nonresident by reason of a tax treaty. ● You are a representative of a foreign
household employees on your final 1995 These tests and the exception are government who holds a diplomatic
Federal income tax return. For more discussed in the instructions for Part I.
Cat. No. 11311Q
passport; a member of the 7. You are a military trainee admitted get through the departure date during
representative’s household; a servant for instruction under the Department of the tax year. If you received a
who accompanies the representative; an Defense and you will leave the United termination assessment and you
employee of an international States on official military travel orders. received additional income within the
organization or foreign government 8. You are a resident of Canada or current tax year, the District Director
whose pay is exempt from U.S. taxes; or Mexico who commutes frequently to the may make additional assessments. If the
a member of the employee’s household United States to work and your wages District Director has not made a
who was not paid by U.S. sources. If are subject to income tax withholding. termination assessment against you,
you signed a waiver of nonimmigrants’ include on your Form 1040-C any
privileges as a condition of holding both income you have received and expect to
your job and your status as an
How To Obtain the receive during the entire tax year of
immigrant, the exception does not apply, Certificate departure.
and you must get a certificate. To get a compliance certificate, go to Generally, a compliance certificate on
● You are a student, industrial trainee, your local IRS office at least 2 weeks Form 1040-C will be issued without your
exchange visitor, or the spouse or child before you leave the United States and paying tax or posting bond if you have
of such an individual with an F-1, F-2, file either Form 2063 or Form 1040-C not received a termination assessment.
H-3, H-4, J-1, J-2, or Q visa. To qualify, and any other tax returns that have not This certificate applies to all your
you must not have received any income been filed as required. The certificate, departures during the current tax year,
from sources in the United States other however, may not be issued more than subject to revocation on any later
than (1) allowances covering expenses 30 days before you leave. If both you departure if the District Director believes
incident to your study or training in the and your spouse are aliens and are your leaving would hinder collecting the
United States (including expenses for leaving together, both of you must go to tax.
travel, maintenance, and tuition), (2) the the IRS office. If you owe income tax and the District
value of any services or Please be prepared to furnish your Director determines that your departure
accommodations furnished incident to anticipated date of departure and bring will jeopardize the collection of the tax, a
such study or training, (3) income from the following records with you if they compliance certificate on Form 1040-C
employment authorized by the U.S. apply. will be issued when you pay the tax due
immigration laws, or (4) interest on or post bond. This certificate applies
1. A valid passport with your alien
deposits if that interest is not effectively only to the departure for which it is
registration card or visa.
connected with a U.S. trade or business. issued.
2. Copies of your U.S. income tax
● You are a student or the spouse or If you go to the departure point
returns filed for the past 2 years. If you
child of a student with an M-1 or M-2 without a certificate or proof that you do
were in the United States for less than 2
visa. To qualify, you must not have not need one, you may be subject to an
years, bring copies of the income tax
received any income from sources in the income tax examination by an IRS
returns you filed for that period.
United States other than (1) income from employee. You will then have to
employment authorized by the U.S. 3. Receipts for income taxes paid on
complete the returns and any other
immigration laws, or (2) interest on these returns.
required documents and either pay any
deposits if that interest is not effectively 4. Receipts, bank records, canceled income tax due or post bond.
connected with a U.S. trade or business. checks, and other documents that prove
● Any of the following applies, unless your deductions, business expenses,
the District Director believes you had and dependents claimed on the returns. Specific Instructions
taxable income during the tax year, up 5. A statement from each employer If your employer is willing to furnish a
through your departure date, or during you worked for this year showing wages letter guaranteeing that the tax will be
the preceding tax year and that your paid and tax withheld. If you are paid, check the “Yes” box. You only
leaving the United States would hinder self-employed, you must bring a need to sign the form and leave the
collecting the tax. statement of income and expenses up remainder blank. Be sure to attach the
1. You are on a pleasure trip and have to the date you plan to leave. letter from your employer to Form
a B-2 visa. 6. Proof of any payments of estimated 1040-C. The letter should state
2. You are on a business trip and have tax for the past year and the current specifically the period and type of tax
a B-1 visa or a combined B-1 and B-2 year. covered.
visa and do not stay in the United 7. Documents showing any gain or Joint Return.—Nonresident aliens may
States or any of its possessions for loss from the sale of personal property, not file a joint return. Resident aliens
more than 90 days during the tax year. including capital assets and may file a joint return on Form 1040-C
3. You are an alien passing through merchandise. only if both of the following apply.
the United States or any of its 8. Documents concerning scholarships 1. The alien and his or her spouse can
possessions on a C-1 visa or under a or fellowship grants such as: (a) reasonably expect to be eligible to file a
contract, such as a bond agreement, verification of the grantor, source, and joint return at the normal close of the
between a transportation line and the purpose of the grant, (b) copies of the tax period for which the return is made.
Attorney General. application for, and approval of, the 2. If the tax period of the alien is
4. You are an alien admitted on a grant, (c) a statement of the amount terminated, the tax periods of both
border-crossing identification card. paid, and the duties and obligations spouses are terminated at the same
under the grant, and (d) a list of any time.
5. You do not need to carry passports,
previous grants. If a joint return is filed on Form
visas, or border-crossing identification
cards because you are visiting for 9. Documents indicating qualification 1040-C, both spouses should enter their
business or pleasure and do not stay in for special tax treaty benefits. names, social security numbers, and
the United States or any of its If you are filing Form 1040-C, file an passport or alien registration card
possessions for more than 90 days original and one copy for the tax year in numbers in the space provided on page
during the tax year. which you plan to leave. If the District 1 of the form. Also, both spouses should
6. You are passing through the United Director has made a termination include their income and furnish the
States or any of its possessions. assessment against you, include on your information requested in Part I of the
Form 1040-C any income you expect to
Page 2
form. If necessary, a separate Part I you are an exempt individual or because Part II—Exemptions
should be completed for each spouse. of a medical condition or problem, file
Form 8843, Statement for Exempt If you are a resident alien, you may
Individuals and Individuals With a claim the same exemptions allowed U.S.
Part I—Explanation of citizens on Form 1040.
Medical Condition, or similar statement,
Status—Resident or with your final income tax return. This Nonresident aliens of Canada, India,
Nonresident Alien rule does not apply to foreign Mexico, Japan, the Republic of Korea,
government or international or U.S. nationals (American Samoans)
Generally, you are considered a resident
organization-related individuals who engaged in a trade or business in the
alien if you meet either the green card
exclude days of presence in the United United States may claim the same
test or the substantial presence test for
States. number of exemptions they are entitled
1995. You are considered a nonresident
Closer connection to a foreign to on Form 1040NR. All other
alien for the year if you do not meet
country exception. Even though you nonresident aliens engaged in a U.S.
either of these tests. For more details on
would otherwise meet the substantial trade or business may claim only one
resident and nonresident status, see
presence test, you are not treated as a exemption. For more details, see Pub.
Pub. 519.
U.S. resident for 1995 if you: 519 or the Form 1040NR instructions.
Green Card Test.—You are a resident
(a) were present in the United States for If you are a nonresident alien not
for tax purposes if you are a lawful
fewer than 183 days during 1995, and engaged in a trade or business in the
permanent resident of the United States
(b) establish that during 1995 you had a United States, you cannot take any
at any time during 1995. You are a lawful
tax home in a foreign country and had a personal exemptions on income that is
permanent resident of the United States
closer connection to that country than to not effectively connected with a U.S.
if you have been given the privilege,
the United States. trade or business.
according to the immigration laws, of
residing permanently in the United Note: If you meet this exception, file
States as an immigrant. You generally Form 8840, Closer Connection Part III—Figuring Your
have this status if the Immigration and Exception Statement for Aliens, or a Income Tax
Naturalization Service (INS) has issued similar statement, with your final income
you an alien registration card also known tax return. Read the descriptions on line 1 of Form
as a “green card.” 1040-C for Groups I, II, and III to see
Dual-Status Tax Year.—Generally, if you
which group applies to you. If Group I or
Substantial Presence Test.—You are leave the United States during the year
II applies, use lines 15–24 to figure your
considered a U.S. resident if you meet with no intent to return, you have a
tax. If Group III applies, use lines 25 and
the substantial presence test for 1995. dual-status tax year and are subject to
26 to figure your tax. If you are a
You meet this test if you were physically dual-status restrictions in completing
nonresident alien and both Groups II and
present in the United States for at least: Form 1040-C. A dual-status tax year is
III apply, use lines 15–26 to figure your
(a) 31 days during 1995, and (b) 183 one in which you have been both a
tax.
days during the period 1995, 1994, and resident alien and a nonresident alien. In
1993, counting all the days of physical figuring your income tax liability, different Line 16—Adjustments.—If you are a
presence in 1995 but only 1⁄3 the number U.S. income tax rules apply to each resident alien, you can take the
of days of presence in 1994 and only 1⁄6 status. See Pub. 519. adjustments allowed on Form 1040. The
the number of days in 1993. Form 1040 instructions have information
Income Effectively Connected With a
on adjustments you may take.
Days of presence in the United U.S. Trade or Business— Nonresident
States. Generally, you are treated as Aliens.—If you are a nonresident alien, If you are a nonresident alien and
present in the United States on any day the tax on your income depends on have income effectively connected with
that you are physically present in the whether the income is or is not a U.S. trade or business, you may take
country at any time during the day. effectively connected with a U.S. trade the adjustments allowed on Form
However, you do not count the following or business. 1040NR. See the Form 1040NR
days of presence in the United States instructions.
Income effectively connected with a
for purposes of the substantial presence U.S. trade or business (including wages If you are a nonresident alien with
test. earned by an employee) is taxed at the income not effectively connected with a
● Days you regularly commuted to work graduated rates that apply to U.S. U.S. trade or business, you cannot take
in the United States from a residence in citizens and resident aliens. Income you any adjustments.
Canada or Mexico. receive as a partner in a partnership or Line 19—Additional Taxes.—Enter on
● Days you were in the United States for as a beneficiary of an estate or trust is line 19 any additional taxes from Form
less than 24 hours when you were considered effectively connected with a 4970, Tax on Accumulation Distribution
traveling between two places outside U.S. trade or business if the partnership, of Trusts, or Form 4972, Tax on
the United States. estate, or trust conducts a U.S. trade or Lump-Sum Distributions.
business. Line 21—Credits.—If you are a resident
● Days you were unable to leave the
United States because of a medical Income from U.S. sources that is not alien, you may claim the same credits as
condition or medical problem that effectively connected with a U.S. trade on Form 1040. If you are a nonresident
developed while you were in the United or business is generally taxed at 30%. alien with income effectively connected
States. Your rate may be lower if the country of with a U.S. trade or business, you may
which you are a citizen or resident and generally deduct the same credits as on
● Days you were an exempt individual. the United States have a treaty setting Form 1040NR.
In general, an exempt individual is an lower rates. See Pub. 901 for more Line 23—Other Taxes.—Enter on line
individual who is a: (a) foreign details. 23 any other taxes such as those listed
government or international For a listing of the kinds of income not below. See the instructions for Forms
organization-related individual, considered effectively connected with a 1040 or 1040NR for information on the
(b) teacher or trainee, (c) student, or U.S. trade or business, see the additional taxes to include on this line.
(d) professional athlete who is
temporarily present in the United States
instructions for Schedules A and B. If ● Self-employment tax. Use Schedule
you are a nonresident alien in the United SE (Form 1040), Form 1040-PR, or Form
to compete in a charitable sports event. States for study or training, see Pub. 1040-SS to figure your self-employment
Note: If you qualify to exclude days of 519. tax. This tax applies only to resident
presence in the United States because
Page 3
aliens. The self-employment tax rate for be filed with the return. You may have an insurance company under an
1995 is 15.3%. This includes a 2.9% an agent in the United States prepare agreement to pay interest on them, if the
Medicare tax and a 12.4% social and sign your return if you are sick or income is not effectively connected with
security tax. For 1995, the maximum otherwise unable to sign. However, you a U.S. trade or business. Also, certain
amount of self-employment income must have IRS approval to use an agent. portfolio interest on obligations issued
subject to social security tax is $61,200. To obtain approval, file a statement with after July 18, 1984.
There is no limit on the amount of the IRS office where you file Form 2. Your personal service income if you:
self-employment income subject to the 1040-C explaining why you cannot sign. ● Were in the United States 90 days or
Medicare tax. Paid Preparers Must Sign. Generally, less during the tax year,
● Alternative minimum tax. Use Form anyone you pay to prepare your return ● Received $3,000 or less for your
6251, Alternative Minimum Tax— must sign it by hand in the space services, and
Individuals, to figure the tax. provided. Signature stamps or labels
cannot be used. The preparer must also ● Performed the services as an
● Tax from recapture of investment employee of or under contract with a
credit. Use Form 4255 to figure the tax. give you a copy of the return for your
records. Someone who prepares your nonresident alien individual, foreign
● Tax from recapture of low-income partnership, or foreign corporation, not
return but does not charge you should
housing credit. Use Form 8611 to engaged in a U.S. trade or business; or
not sign your return.
figure the tax. for a foreign office of a U.S. partnership,
If you have questions about whether a
● Tax from recapture of Federal corporation, citizen, or resident.
preparer is required to sign your return,
mortgage subsidy. Use Form 8828 to 3. Capital gains not effectively
please contact an IRS office.
figure the tax. connected with a U.S. trade or business
● Tax from recapture of qualified if you were in the United States fewer
electric vehicle credit. For details on Schedule A—Schedule of than 183 days during the tax year.
how to figure the tax, get Pub. 535, Income However, the gain or loss on the
Business Expenses. Line 1, Column (d).—Resident aliens disposition of a U.S. real property
Line 26—Tax.—Enter 30% of the should include income that would be interest is not exempt.
amount on line 25. If you are entitled to included on Form 1040, such as 4. U.S. bond income. Your income
a lower rate because of a treaty salaries, wages, interest, dividends, from series E, EE, H, or HH U.S. savings
between your country and the United rents, alimony, etc. bonds that you bought while a resident
States, attach a statement showing your Line 1, Column (e).—Enter nonresident of the Ryukyu Islands (including
computation. alien income effectively connected with Okinawa) or the Trust Territory of the
Line 28—U.S. Income Tax Paid or a U.S. trade or business. Pacific Islands (Caroline and Marshall
Withheld at Source.—Enter the amount Islands).
Line 1, Column (f).—Enter nonresident
from Schedule A, line 4, column (c), or alien income not effectively connected 5. Qualifying annuities. Annuities you
amounts withheld as shown on Forms with a U.S. trade or business, including: received from qualifying annuity plans or
W-2, W-2G, 8288-A, 1099-R, 1042-S, trusts under both the following
8805, etc. ● Interest, dividends, rents, salaries, conditions:
wages, premiums, annuities,
Line 30—Other Payments.—Include on compensation, remuneration, and other ● The work done that entitles you to the
line 30 any of the following payments. fixed or determinable annual or periodic annuity was done either in the United
● Earned income credit. Enter any gains, profits, and income. States for a foreign employer or outside
earned income credit that is due you. the United States, and
● Prizes, awards, and certain gambling
● U.S. income tax paid at previous winnings. Proceeds from lotteries, ● When the first amount was paid as an
departure during the tax period. Enter raffles, etc., are gambling winnings. You annuity, at least 90% of the employees
any tax you paid during the tax period must report the full amount of your covered by the plan (or plans that
when you previously departed the winnings. You cannot offset losses included the trust) were U.S. citizens or
United States. against winnings and report the residents.
● Excess social security and RRTA tax difference. Certain items of income may be
withheld. If you had two or more ● One-half of the U.S. social security exempt from Federal tax by a tax treaty.
employers in 1995 who together paid benefits you receive are taxable. This For more details, see Pub. 901.
you more than $61,200 in wages, too amount is treated as U.S. source income
much social security tax and tier 1 not effectively connected with a U.S. Schedule B—Gains and
railroad retirement (RRTA) tax may have trade or business and is subject to the Losses From Sales or
been withheld. See the instructions for 30% tax rate, unless exempt or taxed at
Form 1040 or Form 1040NR. For 1995, a reduced rate under a U.S. tax treaty. Exchanges of Nonresidents’
the maximum social security tax and tier Social security benefits include any Property Not Effectively
1 RRTA tax is $3,794.40. monthly benefit under title II of the Connected With a U.S. Trade
● Credit for Federal tax paid on fuels. Social Security Act or part of a tier 1
Enter any credit from Form 4136 for tax railroad retirement benefit treated as a or Business
on gasoline, diesel fuel, and other fuels social security benefit. Social security If you are a nonresident alien, use
used in your business, or for certain benefits do not include any Schedule B to figure your gain or loss
diesel-powered cars, vans, and light supplemental security income (SSI) from the sale or exchange of property
trucks. payments. not effectively connected with a U.S.
See the instructions for Forms 1040 or Exempt Income for Nonresident trade or business. Include the following
1040NR for details on other payments. Aliens.—The following income received kinds of income. For more details on
by a nonresident alien is exempt from these kinds of income, see Pub. 519
U.S. tax. and the Instructions for Form 1040NR.
Signature
1. Interest on bank deposits or Income Other Than Capital Gains.—
Form 1040-C is not considered a valid withdrawable accounts with savings and Gains on the disposal of timber, coal, or
return unless you sign it. If an agent loan associations or credit unions that U.S. iron ore with a retained economic
(including your spouse) signs for you, are chartered and supervised under interest.
your authorization of the signature must Federal or state law, or amounts held by
Page 4
 Gains from the sale or exchange of a U.S. trade or business, you can take Single $3,900*
patents, copyrights, secret processes the deductions allowed on Schedule A Married filing separately $3,275*
and formulas, goodwill, trademarks, of Form 1040NR. See the Schedule A
*To these amounts, add the additional
trade brands, franchises, and other like (Form 1040NR) instructions. If you do
amount below.
property, or of any interest in any such not have income effectively connected
property. The gains must result from with a U.S. trade or business, you Additional Amount for the Elderly or
payments for the productivity, use, or cannot take any deductions. the Blind.—An additional standard
disposition of the property or interest. deduction amount of $750 is allowed for
Note: Nonresident aliens of India who
a married individual (whether filing jointly
Original issue discount (OID). If you were students or business apprentices
or separately) or a qualifying widow(er)
sold or exchanged the obligation, may be able to take the standard
who is age 65 or older or blind ($1,500 if
include only the OID that accrued while deduction. See Pub. 519 for details.
the individual is both age 65 or older
you held the obligation minus the Line 2.—If the amount on Form 1040-C, and blind, $3,000 if both spouses are
amount previously included in income. If line 17, is over $114,700 (over $57,350 if age 65 or older and blind). An additional
you received a payment on the married filing separately), use the standard deduction amount of $950 is
obligation, see Pub. 519. worksheet on this page to figure the allowed for an unmarried individual
Capital Gains.—Capital gains in excess amount to enter on line 2. (single or head of household) who is age
of capital losses if you were in the 65 or older or blind ($1,900 if the
United States at least 183 days during Schedule D—Tax individual is both age 65 or older and
the year. However, the gain or loss on blind).
the disposition of a U.S. real property Computation
Note: If you will turn age 65 on January
interest is considered effectively Standard Deduction (Group I only) 1, 1996, you are considered to be age
connected and should be shown on
If you do not itemize your deductions, 65 for 1995.
Schedule A.
you may take the 1995 standard Limited Standard Deduction for
deduction listed below: Dependents.—If you can be claimed as
Schedule C—Itemized a dependent on another person’s 1995
Deductions Filing Standard
return, your standard deduction is the
Status Deduction
If you are a resident alien, you can take greater of $650 or your earned income,
the deductions allowed on Schedule A Married filing jointly or up to the standard deduction amount. To
of Form 1040. See the Schedule A Qualifying widow(er) $6,550* this amount add any additional amount
(Form 1040) instructions. Head of household $5,750* for the elderly or the blind.
If you are a nonresident alien and
have income effectively connected with

Itemized Deductions Worksheet (keep for your records)

1. Add the amounts in columns (b) and (d) of Schedule C,

line 1 1.
2. Enter the total amount included on line 1 above for medical
and dental expenses, investment interest expense, casualty
or theft losses of personal use property, and gambling losses 2.
3. Subtract line 2 from line 1. If zero, stop here; enter the amount
from line 1 above on Schedule C, line 2 3.
4. Multiply line 3 above by 80% (.80) 4.
5. Enter the amount from Form 1040-C,
line 17 5.
6. Enter $114,700 ($57,350 if married filing
separately) 6.
7. Subtract line 6 from line 5. If zero or less,
stop here; enter the amount from line 1
above on Schedule C, line 2 7.
8. Multiply line 7 above by 3% (.03) 8.
9. Enter the smaller of line 4 or line 8 9.
10. Total itemized deductions. Subtract line 9 from line 1. Enter
the result here and on Schedule C, line 2 10.

Page 5
 Deduction for Exemptions Worksheet (keep for your records)
Use this worksheet only if the amount on Schedule D, line 1 or line 7, is more than the amount
shown on line 3 below for your filing status. If the amount on Schedule D, line 1 or line 7, is
equal to or less than the amount shown on line 3, multiply $2,500 by the total number of
exemptions claimed on Form 1040-C, line 14e. Enter the result on Schedule D, line 4 or line
10, whichever applies.
1. Multiply $2,500 by the total number of exemptions claimed on Form 1040-C,
line 14e 1.
2. Enter the amount from Schedule D, line 1 or line 7 2.
3. Enter the amount shown below for your filing status:

%
● Married filing separately, enter $86,025
● Single, enter $114,700
3.
● Head of household, enter $143,350
● Married filing jointly or Qualifying widow(er), enter
$172,050
4. Subtract line 3 from line 2. If zero or less, stop here; enter
the amount from line 1 above on Schedule D, line 4 or
line 10 4.
Note: If line 4 is over $122,500 (over $61,250 if married
filing separately), stop here; you cannot take a deduction
for exemptions. Enter -0- on Schedule D, line 4 or line
10.

5. Divide line 4 by $2,500 ($1,250 if married filing separately).

If the result is not a whole number, round it up to the next
higher whole number (for example, round 0.0004 to 1) 5.
6. Multiply line 5 by 2% (.02) and enter the result as a decimal
amount .
6.
7. Multiply line 1 by line 6 7.
8. Deduction for exemptions. Subtract line 7 from line 1. Enter the result
here and on Schedule D, line 4 or line 10, whichever applies 8.

1995 Tax Rate Schedules (Groups I and II)

Caution: Do not use these Tax Rate Schedules to figure your 1994 taxes. Use only to figure your 1995 taxes.

Schedule X—Single Taxpayers (Groups I and II) Schedule Z—Head of Household (Group I only)
If the amount on Schedule If the amount on Schedule
D, line 5 or 11, is: The tax is: D, line 5, is: The tax is:
of the of the
but not amount but not amount
Over— over— over— Over— over— over—
$0 $23,350 ----- 15% $0 $0 $31,250 ----- 15% $0
23,350 56,550 $3,502.50 + 28% 23,350 31,250 80,750 $4,687.50 + 28% 31,250
56,550 117,950 12,798.50 + 31% 56,550 80,750 130,800 18,547.50 + 31% 80,750
117,950 256,500 31,832.50 + 36% 117,950 130,800 256,500 34,063.00 + 36% 130,800
256,500 - - - - - 81,710.50 + 39.6% 256,500 256,500 ----- 79,315.00 + 39.6% 256,500

Schedule Y—Married Taxpayers and Qualifying Widows and Widowers

Married Filing Joint Returns (Group I only) and
Qualifying Widows and Widowers (Groups I and II) Married Filing Separate Returns (Groups I and II)
If the amount on Schedule If the amount on Schedule
D, line 5 or 11, is: The tax is: D, line 5 or 11, is: The tax is:
of the of the
but not amount but not amount
Over— over— over— Over— over— over—
$0 $39,000 ----- 15% $0 $0 $19,500 ----- 15% $0
39,000 94,250 $5,850.00 + 28% 39,000 19,500 47,125 $2,925.00 + 28% 19,500
94,250 143,600 21,320.00 + 31% 94,250 47,125 71,800 10,660.00 + 31% 47,125
143,600 256,500 36,618.50 + 36% 143,600 71,800 128,250 18,309.25 + 36% 71,800
256,500 ----- 77,262.50 + 39.6% 256,500 128,250 ----- 38,631.25 + 39.6% 128,250

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