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State Tax Forms 1040

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State Tax Forms 1040

State tax forms 1040 3. State tax forms 1040   Exclusions From Gross Income Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Resident AliensForeign Earned Income and Housing Amount Nonresident AliensInterest Income Dividend Income Services Performed for Foreign Employer Gambling Winnings From Dog or Horse Racing Gain From the Sale of Your Main Home Scholarships and Fellowship GrantsExpenses that do not qualify. State tax forms 1040 Introduction Resident and nonresident aliens are allowed exclusions from gross income if they meet certain conditions. State tax forms 1040 An exclusion from gross income is generally income you receive that is not included in your U. State tax forms 1040 S. State tax forms 1040 income and is not subject to U. State tax forms 1040 S. State tax forms 1040 tax. State tax forms 1040 This chapter covers some of the more common exclusions allowed to resident and nonresident aliens. State tax forms 1040 Topics - This chapter discusses: Nontaxable interest, Nontaxable dividends, Certain compensation paid by a foreign employer, Gain from sale of home, and Scholarships and fellowship grants. State tax forms 1040 Useful Items - You may want to see: Publication 54 Tax Guide for U. State tax forms 1040 S. State tax forms 1040 Citizens and Resident Aliens Abroad 523 Selling Your Home See chapter 12 for information about getting these publications. State tax forms 1040 Resident Aliens Resident aliens may be able to exclude the following items from their gross income. State tax forms 1040 Foreign Earned Income and Housing Amount If you are physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months, you may qualify for the foreign earned income exclusion. State tax forms 1040 The exclusion is $97,600 in 2013. State tax forms 1040 In addition, you may be able to exclude or deduct certain foreign housing amounts. State tax forms 1040 You may also qualify if you are a bona fide resident of a foreign country and you are a citizen or national of a country with which the United States has an income tax treaty. State tax forms 1040 For more information, see Publication 54. State tax forms 1040 Foreign country. State tax forms 1040    A foreign country is any territory under the sovereignty of a government other than that of the United States. State tax forms 1040   The term “foreign country” includes the country's territorial waters and airspace, but not international waters and the airspace above them. State tax forms 1040 It also includes the seabed and subsoil of those submarine areas adjacent to the country's territorial waters over which it has exclusive rights under international law to explore and exploit the natural resources. State tax forms 1040   The term “foreign country” does not include U. State tax forms 1040 S. State tax forms 1040 possessions or territories. State tax forms 1040 It does not include the Antarctic region. State tax forms 1040 Nonresident Aliens Nonresident aliens can exclude the following items from their gross income. State tax forms 1040 Interest Income Interest income that is not connected with a U. State tax forms 1040 S. State tax forms 1040 trade or business is excluded from income if it is from: Deposits (including certificates of deposit) with persons in the banking business, Deposits or withdrawable accounts with mutual savings banks, cooperative banks, credit unions, domestic building and loan associations, and other savings institutions chartered and supervised as savings and loan or similar associations under federal or state law (if the interest paid or credited can be deducted by the association), and Amounts held by an insurance company under an agreement to pay interest on them. State tax forms 1040 State and local government obligations. State tax forms 1040   Interest on obligations of a state or political subdivision, the District of Columbia, or a U. State tax forms 1040 S. State tax forms 1040 possession, generally is not included in income. State tax forms 1040 However, interest on certain private activity bonds, arbitrage bonds, and certain bonds not in registered form is included in income. State tax forms 1040 Portfolio interest. State tax forms 1040   Interest and original issue discount that qualifies as portfolio interest is not subject to NRA withholding. State tax forms 1040 To qualify as portfolio interest, the interest must be paid on obligations issued after July 18, 1984, and otherwise subject to NRA withholding. State tax forms 1040 Note. State tax forms 1040 For obligations issued after March 18, 2012, portfolio interest does not include interest paid on debt that is not in registered form. State tax forms 1040 Before March 19, 2012, portfolio interest included interest on certain registered and nonregistered (bearer) bonds if the obligations meet the requirements described below. State tax forms 1040 Obligations in registered form. State tax forms 1040   Portfolio interest includes interest paid on an obligation that is in registered form, and for which you have received documentation that the beneficial owner of the obligation is not a United States person. State tax forms 1040   Generally, an obligation is in registered form if: (i) the obligation is registered as to both principal and any stated interest with the issuer (or its agent) and any transfer of the obligation may be effected only by surrender of the old obligation and reissuance to the new holder; (ii) the right to principal and stated interest with respect to the obligation may be transferred only through a book entry system maintained by the issuer or its agent; or (iii) the obligation is registered as to both principal and stated interest with the issuer or its agent and can be transferred both by surrender and reissuance and through a book entry system. State tax forms 1040   An obligation that would otherwise be considered to be in registered form is not considered to be in registered form as of a particular time if it can be converted at any time in the future into an obligation that is not in registered form. State tax forms 1040 For more information on whether obligations are considered to be in registered form, see Portfolio interest in Publication 515. State tax forms 1040 Obligations not in registered form. State tax forms 1040    For obligations issued before March 19, 2012, interest on an obligation that is not in registered form (bearer obligation) is portfolio interest if the obligation is foreign-targeted. State tax forms 1040 A bearer obligation is foreign-targeted if: There are arrangements to ensure that the obligation will be sold, or resold in connection with the original issue, only to a person who is not a United States person, Interest on the obligation is payable only outside the United States and its possessions, and The face of the obligation contains a statement that any United States person who holds the obligation will be subject to limits under the United States income tax laws. State tax forms 1040   Documentation is not required for interest on bearer obligations to qualify as portfolio interest. State tax forms 1040 In some cases, however, you may need documentation for purposes of Form 1099 reporting and backup withholding. State tax forms 1040 Interest that does not qualify as portfolio interest. State tax forms 1040   Payments to certain persons and payments of contingent interest do not qualify as portfolio interest. State tax forms 1040 You must withhold at the statutory rate on such payments unless some other exception, such as a treaty provision, applies. State tax forms 1040 Contingent interest. State tax forms 1040   Portfolio interest does not include contingent interest. State tax forms 1040 Contingent interest is either of the following: Interest that is determined by reference to: Any receipts, sales, or other cash flow of the debtor or related person, Income or profits of the debtor or related person, Any change in value of any property of the debtor or a related person, or Any dividend, partnership distributions, or similar payments made by the debtor or a related person. State tax forms 1040 For exceptions, see Internal Revenue Code section 871(h)(4)(C). State tax forms 1040 Any other type of contingent interest that is identified by the Secretary of the Treasury in regulations. State tax forms 1040 Related persons. State tax forms 1040   Related persons include the following. State tax forms 1040 Members of a family, including only brothers, sisters, half-brothers, half-sisters, spouse, ancestors (parents, grandparents, etc. State tax forms 1040 ), and lineal descendants (children, grandchildren, etc. State tax forms 1040 ). State tax forms 1040 Any person who is a party to any arrangement undertaken for the purpose of avoiding the contingent interest rules. State tax forms 1040 Certain corporations, partnerships, and other entities. State tax forms 1040 For details, see Nondeductible Loss in chapter 2 of Publication 544. State tax forms 1040 Exception for existing debt. State tax forms 1040   Contingent interest does not include interest paid or accrued on any debt with a fixed term that was issued: On or before April 7, 1993, or After April 7, 1993, pursuant to a written binding contract in effect on that date and at all times thereafter before that debt was issued. State tax forms 1040 Dividend Income The following dividend income is exempt from the 30% tax. State tax forms 1040 Certain dividends paid by foreign corporations. State tax forms 1040   There is no 30% tax on U. State tax forms 1040 S. State tax forms 1040 source dividends you receive from a foreign corporation. State tax forms 1040 See Second exception under Dividends in chapter 2 for how to figure the amount of U. State tax forms 1040 S. State tax forms 1040 source dividends. State tax forms 1040 Certain interest-related dividends. State tax forms 1040   There is no 30% tax on interest-related dividends from sources within the United States that you receive from a mutual fund or other regulated investment company in 2013. State tax forms 1040 The mutual fund will designate in writing which dividends are interest-related dividends. State tax forms 1040 Certain short-term capital gain dividends. State tax forms 1040   There may not be any 30% tax on certain short-term capital gain dividends from sources within the United States that you receive from a mutual fund or other regulated investment company. State tax forms 1040 The mutual fund will designate in writing which dividends are short-term capital gain dividends. State tax forms 1040 This tax relief will not apply to you if you are present in the United States for 183 days or more during your tax year. State tax forms 1040 Services Performed for Foreign Employer If you were paid by a foreign employer, your U. State tax forms 1040 S. State tax forms 1040 source income may be exempt from U. State tax forms 1040 S. State tax forms 1040 tax, but only if you meet one of the situations discussed next. State tax forms 1040 Employees of foreign persons, organizations, or offices. State tax forms 1040   Income for personal services performed in the United States as a nonresident alien is not considered to be from U. State tax forms 1040 S. State tax forms 1040 sources and is tax exempt if you meet all three of the following conditions. State tax forms 1040 You perform personal services as an employee of or under a contract with a nonresident alien individual, foreign partnership, or foreign corporation, not engaged in a trade or business in the United States; or you work for an office or place of business maintained in a foreign country or possession of the United States by a U. State tax forms 1040 S. State tax forms 1040 corporation, a U. State tax forms 1040 S. State tax forms 1040 partnership, or a U. State tax forms 1040 S. State tax forms 1040 citizen or resident. State tax forms 1040 You perform these services while you are a nonresident alien temporarily present in the United States for a period or periods of not more than a total of 90 days during the tax year. State tax forms 1040 Your pay for these services is not more than $3,000. State tax forms 1040 If you do not meet all three conditions, your income from personal services performed in the United States is U. State tax forms 1040 S. State tax forms 1040 source income and is taxed according to the rules in chapter 4. State tax forms 1040   If your pay for these services is more than $3,000, the entire amount is income from a trade or business within the United States. State tax forms 1040 To find if your pay is more than $3,000, do not include any amounts you get from your employer for advances or reimbursements of business travel expenses, if you were required to and did account to your employer for those expenses. State tax forms 1040 If the advances or reimbursements are more than your expenses, include the excess in your pay for these services. State tax forms 1040   A day means a calendar day during any part of which you are physically present in the United States. State tax forms 1040 Example 1. State tax forms 1040 During 2013, Henry Smythe, a nonresident alien from a nontreaty country, worked for an overseas office of a U. State tax forms 1040 S. State tax forms 1040 partnership. State tax forms 1040 Henry, who uses the calendar year as his tax year, was temporarily present in the United States for 60 days during 2013 performing personal services for the overseas office of the partnership. State tax forms 1040 That office paid him a total gross salary of $2,800 for those services. State tax forms 1040 During 2013, he was not engaged in a trade or business in the United States. State tax forms 1040 The salary is not considered U. State tax forms 1040 S. State tax forms 1040 source income and is exempt from U. State tax forms 1040 S. State tax forms 1040 tax. State tax forms 1040 Example 2. State tax forms 1040 The facts are the same as in Example 1, except that Henry's total gross salary for the services performed in the United States during 2013 was $4,500. State tax forms 1040 He received $2,875 in 2013, and $1,625 in 2014. State tax forms 1040 During 2013, he was engaged in a trade or business in the United States because the compensation for his personal services in the United States was more than $3,000. State tax forms 1040 Henry's salary is U. State tax forms 1040 S. State tax forms 1040 source income and is taxed under the rules in chapter 4. State tax forms 1040 Crew members. State tax forms 1040   Compensation for services performed by a nonresident alien in connection with the individual's temporary presence in the United States as a regular crew member of a foreign vessel (for example, a boat or ship) engaged in transportation between the United States and a foreign country or U. State tax forms 1040 S. State tax forms 1040 possession is not U. State tax forms 1040 S. State tax forms 1040 source income and is exempt from U. State tax forms 1040 S. State tax forms 1040 tax. State tax forms 1040 This exemption does not apply to compensation for services performed on foreign aircraft. State tax forms 1040 Students and exchange visitors. State tax forms 1040   Nonresident alien students and exchange visitors present in the United States under “F,” “J,” or “Q” visas can exclude from gross income pay received from a foreign employer. State tax forms 1040   This group includes bona fide students, scholars, trainees, teachers, professors, research assistants, specialists, or leaders in a field of specialized knowledge or skill, or persons of similar description. State tax forms 1040 It also includes the alien's spouse and minor children if they come with the alien or come later to join the alien. State tax forms 1040   A nonresident alien temporarily present in the United States under a “J” visa includes an alien individual entering the United States as an exchange visitor under the Mutual Educational and Cultural Exchange Act of 1961. State tax forms 1040 Foreign employer. State tax forms 1040   A foreign employer is: A nonresident alien individual, foreign partnership, or foreign corporation, or An office or place of business maintained in a foreign country or in a U. State tax forms 1040 S. State tax forms 1040 possession by a U. State tax forms 1040 S. State tax forms 1040 corporation, a U. State tax forms 1040 S. State tax forms 1040 partnership, or an individual who is a U. State tax forms 1040 S. State tax forms 1040 citizen or resident. State tax forms 1040   The term “foreign employer” does not include a foreign government. State tax forms 1040 Pay from a foreign government that is exempt from U. State tax forms 1040 S. State tax forms 1040 income tax is discussed in chapter 10. State tax forms 1040 Income from certain annuities. State tax forms 1040   Do not include in income any annuity received under a qualified annuity plan or from a qualified trust exempt from U. State tax forms 1040 S. State tax forms 1040 income tax if you meet both of the following conditions. State tax forms 1040 You receive the annuity only because: You performed personal services outside the United States while you were a nonresident alien, or You performed personal services inside the United States while you were a nonresident alien and you met the three conditions, described earlier, under Employees of foreign persons, organizations, or offices . State tax forms 1040 At the time the first amount is paid as an annuity under the plan (or by the trust), 90% or more of the employees for whom contributions or benefits are provided under the annuity plan (or under the plan of which the trust is a part) are U. State tax forms 1040 S. State tax forms 1040 citizens or residents. State tax forms 1040   If the annuity qualifies under condition (1) but not condition (2) above, you do not have to include the amount in income if: You are a resident of a country that gives a substantially equal exclusion to U. State tax forms 1040 S. State tax forms 1040 citizens and residents, or You are a resident of a beneficiary developing country under Title V of the Trade Act of 1974. State tax forms 1040   If you are not sure whether the annuity is from a qualified annuity plan or qualified trust, ask the person who made the payment. State tax forms 1040 Income affected by treaties. State tax forms 1040   Income of any kind that is exempt from U. State tax forms 1040 S. State tax forms 1040 tax under a treaty to which the United States is a party is excluded from your gross income. State tax forms 1040 Income on which the tax is only limited by treaty, however, is included in gross income. State tax forms 1040 See chapter 9. State tax forms 1040 Gambling Winnings From Dog or Horse Racing You can exclude from your gross income winnings from legal wagers initiated outside the United States in a parimutuel pool with respect to a live horse or dog race in the United States. State tax forms 1040 Gain From the Sale of Your Main Home If you sold your main home, you may be able to exclude up to $250,000 of the gain on the sale of your home. State tax forms 1040 If you are married and file a joint return, you may be able to exclude up to $500,000. State tax forms 1040 For information on the requirements for this exclusion, see Publication 523. State tax forms 1040 This exclusion does not apply to nonresident aliens who are subject to the expatriation tax rules discussed in chapter 4. State tax forms 1040 Scholarships and Fellowship Grants If you are a candidate for a degree, you may be able to exclude from your income part or all of the amounts you receive as a qualified scholarship. State tax forms 1040 The rules discussed here apply to both resident and nonresident aliens. State tax forms 1040 If a nonresident alien receives a grant that is not from U. State tax forms 1040 S. State tax forms 1040 sources, it is not subject to U. State tax forms 1040 S. State tax forms 1040 tax. State tax forms 1040 See Scholarships, Grants, Prizes, and Awards in chapter 2 to determine whether your grant is from U. State tax forms 1040 S. State tax forms 1040 sources. State tax forms 1040 A scholarship or fellowship is excludable from income only if: You are a candidate for a degree at an eligible educational institution, and You use the scholarship or fellowship to pay qualified education expenses. State tax forms 1040 Candidate for a degree. State tax forms 1040   You are a candidate for a degree if you: Attend a primary or secondary school or are pursuing a degree at a college or university, or Attend an accredited educational institution that is authorized to provide: A program that is acceptable for full credit toward a bachelor's or higher degree, or A program of training to prepare students for gainful employment in a recognized occupation. State tax forms 1040 Eligible educational institution. State tax forms 1040   An eligible educational institution is one that maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance at the place where it carries on its educational activities. State tax forms 1040 Qualified education expenses. State tax forms 1040   These are expenses for: Tuition and fees required to enroll at or attend an eligible educational institution, and Course-related expenses, such as fees, books, supplies, and equipment that are required for the courses at the eligible educational institution. State tax forms 1040 These items must be required of all students in your course of instruction. State tax forms 1040 However, in order for these to be qualified education expenses, the terms of the scholarship or fellowship cannot require that it be used for other purposes, such as room and board, or specify that it cannot be used for tuition or course-related expenses. State tax forms 1040 Expenses that do not qualify. State tax forms 1040   Qualified education expenses do not include the cost of: Room and board, Travel, Research, Clerical help, or Equipment and other expenses that are not required for enrollment in or attendance at an eligible educational institution. State tax forms 1040 This is true even if the fee must be paid to the institution as a condition of enrollment or attendance. State tax forms 1040 Scholarship or fellowship amounts used to pay these costs are taxable. State tax forms 1040 Amounts used to pay expenses that do not qualify. State tax forms 1040   A scholarship amount used to pay any expense that does not qualify is taxable, even if the expense is a fee that must be paid to the institution as a condition of enrollment or attendance. State tax forms 1040 Payment for services. State tax forms 1040   You cannot exclude from income the portion of any scholarship, fellowship, or tuition reduction that represents payment for past, present, or future teaching, research, or other services. State tax forms 1040 This is true even if all candidates for a degree are required to perform the services as a condition for receiving the degree. State tax forms 1040 Example. State tax forms 1040 On January 7, Maria Gomez is notified of a scholarship of $2,500 for the spring semester. State tax forms 1040 As a condition for receiving the scholarship, Maria must serve as a part-time teaching assistant. State tax forms 1040 Of the $2,500 scholarship, $1,000 represents payment for her services. State tax forms 1040 Assuming that Maria meets all other conditions, she can exclude no more than $1,500 from income as a qualified scholarship. State tax forms 1040 Prev  Up  Next   Home   More Online Publications
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IRS to Waive Forms 5498, 1098-T and 1099-G Penalties for the Initial Year of Introduction

In tax year 2011, the IRS introduced Forms 5498, 1098-T and 1099-G into the penalty notice program and included these returns on the Notice 972CG. Though inaccurate information returns may be assessed a penalty under Internal Revenue Code section 6721 (Failure to File Correct Information Returns), the IRS will waive penalties associated with these three forms for the 2011 introductory tax year.

Taxpayers who receive Notice 972CG, with any of the forms listed, are urged to respond to the IRS Campus as directed in the notice to obtain a waiver of the penalties. The IRS is working the requests for waiver in the order that they are received. It may be several weeks before taxpayers receive notification that their penalties are waived.

Again, at this time, the waiver applies to the 2011 tax period only.

Taxpayers and/or representatives who have questions should contact the IRS per the instructions in their notice.

Page Last Reviewed or Updated: 20-Mar-2014

The State Tax Forms 1040

State tax forms 1040 5. State tax forms 1040   Illustrated Examples Table of Contents Illustrated Example of Form 4563Line 1. State tax forms 1040 Line 2. State tax forms 1040 Lines 3a and 3b. State tax forms 1040 Lines 4a and 4b. State tax forms 1040 Line 5. State tax forms 1040 Line 6. State tax forms 1040 Line 7. State tax forms 1040 Line 9. State tax forms 1040 Line 15. State tax forms 1040 Illustrated Example of Form 5074Part I. State tax forms 1040 Part II. State tax forms 1040 Part III. State tax forms 1040 Illustrated Example of Form 8689Part I. State tax forms 1040 Part II. State tax forms 1040 Part III. State tax forms 1040 Part IV. State tax forms 1040 Use the following examples to help you complete the correct attachment to your Form 1040. State tax forms 1040 The completed form for each example is shown on the pages that follow. State tax forms 1040 Illustrated Example of Form 4563 John Black is a U. State tax forms 1040 S. State tax forms 1040 citizen, single, and under 65. State tax forms 1040 He was a bona fide resident of American Samoa during all of 2013. State tax forms 1040 John must file Form 1040 because his gross income from sources outside the possessions ($10,000 of dividends from U. State tax forms 1040 S. State tax forms 1040 corporations) is more than his adjusted filing requirement for single filers under 65. State tax forms 1040 (See Filing Requirement if Possession Income Is Excluded in chapter 4. State tax forms 1040 ) Because he must file Form 1040 (not illustrated), he fills out Form 4563 to determine the amount of income from American Samoa he can exclude. State tax forms 1040 See Bona Fide Resident of American Samoa in chapter 3. State tax forms 1040 Completing Form 4563. State tax forms 1040   John enters his name and social security number at the top of the form. State tax forms 1040 Line 1. State tax forms 1040   On Form 4563 (see later), John enters the date his bona fide residence began in American Samoa, June 2, 2012. State tax forms 1040 Because he is still a bona fide resident, he enters “not ended” in the second blank space. State tax forms 1040 Line 2. State tax forms 1040   He checks the box labeled “Rented house or apartment” to describe his type of living quarters in American Samoa. State tax forms 1040 Lines 3a and 3b. State tax forms 1040   He checks “No” on line 3a because no family members lived with him. State tax forms 1040 He leaves line 3b blank. State tax forms 1040 Lines 4a and 4b. State tax forms 1040   He checks “No” on line 4a because he did not maintain a home outside American Samoa. State tax forms 1040 He leaves line 4b blank. State tax forms 1040 Line 5. State tax forms 1040   He enters the name and address of his employer, Samoa Products Co. State tax forms 1040 It is a private American Samoa corporation. State tax forms 1040 Line 6. State tax forms 1040   He enters the dates of his 2-week vacation to New Zealand from November 11 to November 25. State tax forms 1040 That was his only trip outside American Samoa during the year. State tax forms 1040 Line 7. State tax forms 1040   He enters the $24,000 in wages he received from Samoa Products Co. State tax forms 1040 Line 9. State tax forms 1040   He received $220 in dividends from an American Samoa corporation, which he enters here. State tax forms 1040 He also received $10,000 of dividends from a U. State tax forms 1040 S. State tax forms 1040 corporation, but he will enter that amount only on his Form 1040 because the U. State tax forms 1040 S. State tax forms 1040 dividends do not qualify for the possession exclusion. State tax forms 1040 Line 15. State tax forms 1040   John totals the amounts on lines 7 and 9 to get the amount he can exclude from his gross income in 2013. State tax forms 1040 He will not enter his excluded income on Form 1040. State tax forms 1040 However, he will attach his completed Form 4563 to his Form 1040. State tax forms 1040 Illustrated Example of Form 5074 Tracy Grey is a U. State tax forms 1040 S. State tax forms 1040 citizen who is a self-employed fisheries consultant with a tax home in New York. State tax forms 1040 Her only income for 2013 was net self-employment income of $80,000. State tax forms 1040 Of the $80,000, $20,000 was from consulting work in Guam and the rest was earned in the United States. State tax forms 1040 Thinking she would owe tax to Guam on the $20,000, Tracy made estimated tax payments of $1,409 to Guam. State tax forms 1040 She was not a bona fide resident of Guam during 2013. State tax forms 1040 Tracy completes Form 1040 (not illustrated), reporting her worldwide income. State tax forms 1040 Because the adjusted gross income on her Form 1040 was $50,000 or more and at least $5,000 of her gross income is from Guam, Tracy must file Form 5074 with her Form 1040. State tax forms 1040 All amounts reported on Form 5074 are also reported on her Form 1040. State tax forms 1040 See U. State tax forms 1040 S. State tax forms 1040 Citizen or Resident Alien (Other Than a Bona Fide Resident of Guam) in chapter 3. State tax forms 1040 Completing Form 5074. State tax forms 1040   Tracy enters her name and social security number at the top of the form. State tax forms 1040 Part I. State tax forms 1040   On Form 5074 (see later), Tracy enters her self-employment income from Guam ($20,000) on line 6. State tax forms 1040 She has no other income from Guam, so the total on line 16 is $20,000. State tax forms 1040 Part II. State tax forms 1040   Tracy's only adjustment in Part II is the deductible part of the self-employment tax on her net income earned in Guam. State tax forms 1040 She enters $1,413 on line 21 and line 28. State tax forms 1040 Her adjusted gross income on line 29 is $18,587. State tax forms 1040 Part III. State tax forms 1040   Tracy made estimated tax payments of $1,409. State tax forms 1040 She enters this amount on line 30, and again on line 34 as the total payments. State tax forms 1040 Illustrated Example of Form 8689 Juan and Carla Moreno live and work in the United States. State tax forms 1040 In 2013, they received $14,400 in income from the rental of a condominium they own in the U. State tax forms 1040 S. State tax forms 1040 Virgin Islands (USVI). State tax forms 1040 The rental income was deposited in a bank in the USVI and they received $500 of interest on this income. State tax forms 1040 They were not bona fide residents of the USVI during the entire tax year. State tax forms 1040 The Morenos complete Form 1040 (not illustrated), reporting their income from all sources, including their interest income and the income and expenses from their USVI rental property (reported on Schedule E (Form 1040)). State tax forms 1040 The Morenos take the standard deduction for married filing jointly, both are under 65, and they have no dependents. State tax forms 1040 The Morenos also complete Form 8689 to determine how much of their U. State tax forms 1040 S. State tax forms 1040 tax shown on Form 1040, line 61 (with certain adjustments), must be paid to the U. State tax forms 1040 S. State tax forms 1040 Virgin Islands. State tax forms 1040 See U. State tax forms 1040 S. State tax forms 1040 Citizen or Resident Alien (Other Than a Bona Fide Resident of the USVI) in chapter 3. State tax forms 1040 The Morenos file their Form 1040, attaching Form 8689 and all other schedules, with the Internal Revenue Service. State tax forms 1040 At the same time, they send a copy of their Form 1040 with all attachments, including Form 8689, to the Virgin Islands Bureau of Internal Revenue. State tax forms 1040 The Virgin Islands Bureau of Internal Revenue will process this copy. State tax forms 1040 Completing Form 8689. State tax forms 1040   Juan and Carla enter their names and Juan's social security number at the top of the form. State tax forms 1040 Part I. State tax forms 1040   The Morenos enter their income from the USVI in Part I (see later). State tax forms 1040 The interest income is entered on line 2 and the net rental income of $6,200 ($14,400 of rental income minus $8,200 of rental expenses) is entered on line 11. State tax forms 1040 The Morenos' total USVI income of $6,700 is entered on line 16. State tax forms 1040 Part II. State tax forms 1040   The Morenos have no adjustments to their USVI income, so they enter zero (-0-) on line 28, and $6,700 on line 29. State tax forms 1040 Their USVI adjusted gross income (AGI) is $6,700. State tax forms 1040 Part III. State tax forms 1040   On line 30, the Morenos enter the amount from Form 1040, line 61 ($4,539). State tax forms 1040 Their Form 1040 does not show any entries required on line 31, so they leave that line blank and enter $4,539 on line 32. State tax forms 1040   The Morenos enter their worldwide AGI, $54,901 (Form 1040, line 38), on line 33. State tax forms 1040 Next, they find what percentage of their AGI is from USVI sources ($6,700 ÷ $54,901 = 0. State tax forms 1040 122) and enter that as a decimal on line 34. State tax forms 1040 They then apply that percentage to the U. State tax forms 1040 S. State tax forms 1040 tax entered on line 32 to find the amount of U. State tax forms 1040 S. State tax forms 1040 tax allocated to USVI income ($4,539 x 0. State tax forms 1040 122 = $554), and enter that amount on line 35. State tax forms 1040 Part IV. State tax forms 1040   Part IV is used to show payments of income tax to the USVI only. State tax forms 1040 The Morenos had no tax withheld by the U. State tax forms 1040 S. State tax forms 1040 Virgin Islands, but made estimated tax payments to the USVI of $400, which they entered on lines 37 and 39. State tax forms 1040 They include this amount ($400) in the total payments on Form 1040, line 72. State tax forms 1040 On the dotted line next to the entry space for line 72, they enter “Form 8689” and show the amount. State tax forms 1040 The Morenos do not complete Form 1116 because they receive credit on Form 1040, line 72, for the tax paid to the USVI. State tax forms 1040   The income tax they owe to the USVI ($154) is shown on Form 8689, line 44. State tax forms 1040 They enter this amount on line 45. State tax forms 1040 They also include this additional amount ($154) on the dotted line next to the entry space and in the total on Form 1040, line 72. State tax forms 1040 The Morenos will pay their USVI tax at the same time they file the copy of their U. State tax forms 1040 S. State tax forms 1040 income tax return with the U. State tax forms 1040 S. State tax forms 1040 Virgin Islands. State tax forms 1040 This image is too large to be displayed in the current screen. State tax forms 1040 Please click the link to view the image. State tax forms 1040 Form 4563, page 1 for John Black This image is too large to be displayed in the current screen. State tax forms 1040 Please click the link to view the image. State tax forms 1040 Form 5074, for Tracy Grey This image is too large to be displayed in the current screen. State tax forms 1040 Please click the link to view the image. State tax forms 1040 Form 8689, page 1 for Juan and Carla Moreno Prev  Up  Next   Home   More Online Publications