www.irs.gov

Enter keyword: "volunteer training" or "link and learn"

Work at your own pace

The benefits.....

Check-out the course and send your comments to 

Share your opinion.....

partner@irs.gov

Take this VITA/TCE course on-line 

Access it anytime, anywhere-24/7...it's on the Internet 

Complete your volunteer certification online

@

E-learning for Volunteer Return Preparation

is now available.
TaxWise® is a copyrighted software program owned by Universal Tax Systems, Inc.® (UTS).

All screen shots that appear throughout the official Volunteer Income Tax Assistance (VITA)

and Tax Counseling for the Elderly (TCE) training materials are used with the permission of

UTS. The screen shots used in this publication—or any other screen shots from TaxWise or

its affiliated programs—may not be extracted, copied, or distributed without written approval

from the IRS SPEC Office of Education and Product Development.

Confidentiality Statement:

All tax information you receive from taxpayers in your VOLUNTEER capacity is strictly confidential and should not, under any circumstances, be disclosed to unauthorized individuals.

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.

IRS

Department of the Treasury

Internal Revenue Service

www.irs.gov
3

This retest is an open-book test. You may use your course book or any other reference 

materials you will use as a volunteer. Please complete the retest on your own. Taking the retest 

in groups or with outside assistance could prove to be a disservice to the people you have 

volunteered to help.

The retest is divided into four parts as outlined below. You only need to complete the sections 

that you failed on the test.

Part A—Basic Covers the general tax laws which apply to 

all taxpayers. This section is based on

lessons 1–7 of your course book.

Part B—Wage Earner Covers credits and questions for the typical 

wage earner. This section is based on

lessons 8–11 of your course book.

Part C—Pension Earner Covers credits and questions for the typical 

pension earner. This section is based on 

lessons 12–14 of your course book.

Part D—Military Returns Covers the unique questions for the typical 

member of the armed forces. This section 

is based on the military segment contained 

in the military course book.

Introduction to the Retest
4

What to do when you complete your retest:

After you have completed your retest, please transfer all answers to the tear-out Retest 

Answer Sheet located on the next page. Forward the completed Retest Answer Sheet and the 

completed Volunteer Agreement/Certifi cation Sheet to your sponsor or instructor as directed 

for grading. Do not send your entire retest booklet unless otherwise directed.

You will receive your answer sheet back with your results. 

You need to answer 70% of the questions correctly in the sections you are completing 

on this retest.

Using Tax Software to take the Retest

All social security numbers, employer identifi cation numbers and routing/account numbers 

in this document are depicted as xxx-xx-xxxx, xx-xxxxxxx or xxxxxxx accordingly. Volunteers 

using tax preparation software to complete the retest should replace the x’s as directed by 

the software. All taxpayer names and street addresses use names from a listing of colleges/

universities as provided by IRS manuals. Use your city, state, and zip code when completing 

any of the forms.

Volunteers who use tax preparation software to complete the test or retest need to be aware 

of their version of software. Only the fi nal 2004 version of software will generate the correct 

answers for 2004 tax returns. 
5

Retest Answer Sheet

Instructions: Record all of your answers on 

this sheet in the boxes provided below. Your 

instructor will tell you where you should send 

this sheet for grading. The grader will return 

this sheet to you. Be sure to include your 

completed Volunteer Agreement (see next 

page) with this sheet, if you did not provide it 

with your test answer sheet.

Name:

Address:

Part A — Basic (Requires 14 correct answers to pass)

1 2 3 4 5 6 7 8 9 10

11 12 13 14 15 16 17 18 19 20

Part B — Wage Earner (Requires 14 correct answers to pass)

1 2 3 4 5 6 7 8 9 10

11 12 13 14 15 16 17 18 19 20

Part C — Pension Earner (Requires 14 correct answers to pass)

1 2 3 4 5 6 7 8 9 10

11 12 13 14 15 16 17 18 19 20

Part D — Military (Requires 28 correct answers to pass)

1 2 3 4 5 6 7 8 9 10

11 12 13 14 15 16 17 18 19 20

21 22 23 24 25 26 27 28 29 30

31 32 33 34 35 36 37 38 39 40

Retest Scoring and Certification – To be completed by the grader.

Part A

Basic

Part B

Wage Earner

Part C

Pension

Earner

Part D

Military

Number of correct answers

Pass (yes/no)

Certifi ed (yes/no)

(This information is needed to 

return your results promptly.)

7

Department of the Treasury – Internal Revenue Service

The mission of the Volunteer Return Preparation Program is to provide free basic tax return preparation for 

eligible taxpayers. Volunteers are the program's most valuable resource. To establish the greatest degree of 

public trust Volunteers have a responsibility to provide high quality service and uphold the highest of ethical 

standards. 

Participants in the Volunteer Return Preparation Program commit to the following standards of conduct:

I will not accept payment for the services I 

provide 

Volunteer Name (print) Volunteer Signature and Date

Home Street Address Daytime Telephone Number

City, State and Zip Code E-mail Address

Sponsoring Organization Name

This form is to be retained at the Site or Partner level.

Volunteer Agreement

(Standards of Conduct – Volunteer Return Preparation Program)

•

Cat. No. 39082Q Form 13615A (Rev. 9-2004)

The Privacy Act of 1974 requires that when we ask for information we 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.

Our legal right to ask for information is 5 U.S.C. 301.

We are asking for this information to assist us in contacting you relative to your interest and/or participation in the IRS volunteer income tax 

preparation and outreach programs. The information you provide may be furnished to others who coordinate activities and staffing at volunteer 

return preparation sites or outreach activities. The information may also be used to establish effective controls, send correspondence and 

recognize volunteers.

Your response is voluntary. However, if you do not provide the requested information, the IRS may not be able to use your assistance in these 

programs.

Privacy Act Notice

Form 13615A

(September-2004)

I will treat all taxpayers professionally, with 

courtesy and respect 

I will safeguard the confidentiality of taxpayer 

information

I will apply the tax laws equitably and accurately 

to the best of my ability

I will only prepare returns within the scope of my 

training and experience 

I will exercise reasonable care in the use and 

protection of equipment and supplies 

I will not solicit business from taxpayers I assist 

Certification (IRS or Sponsor Use Only)

Certified by: Date:

Part A

Basic

Part B

Wage Earner

Part D

Military

Part C

Pension Earner

Number of Correct Answers

Pass (yes/no)

Certified (yes/no)

•

•

•

•

•

•

9

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

PART A — Basic 

For questions A-1 through A-13, determine whether each of the following statements is 

true or false (select a or b) and record your answers on the answer sheet located in the 

front of the retest booklet.

a. True

b. False

A-1 James and Irene are married but fi le separately. James itemizes on his Form 1040. 

Irene also wants a return prepared. Although she wants to take the standard deduction, 

she must itemize.

A-2 George marries on December 31, 2004. He has a choice of fi ling either single, married 

fi ling jointly, or married filing separately.

A-3 William and Mary have a child born at 11:59 pm on December 31, 2004. The child 

only lived with the parents for 1 minute during 2004. They can claim the child as a 

dependent.

A-4 John’s only income in 2004 was from wages and $34 in interest reported in Box 1 of a 

Form 1099-INT from his bank. He must report the interest on Schedule B.

A-5 Contributions to Roth IRA’s are deductible.

A-6 The maximum amount of expense that can be deducted from income on Schedule 

C-EZ is $5,000.

A-7 Income reported on a Form 1099-MISC for a person who is self-employed, can be 

reported on Schedule C-EZ. 

A-8 A taxpayer asks you how long he or she should keep a tax return. Your answer should 

be, 3 years from the date the return was due or fi led or 2 years from the date the tax 

was paid, whichever is later.

A-9 Two taxpayers may claim the same exemption provided the dependent lived for 6 

months of the year with each taxpayer.

A-10 A taxpayer who has received a Form 1099-MISC for self-employment may be subject to 

self-employment taxes.

A-11 Shirley receives child support from her former husband, Paul. Child support payments 

are taxable income to Shirley.
10

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

A-12 If the taxpayer does not provide an account and routing number for a direct deposit, the 

IRS will automatically mail a check if a refund is due. 

A-13 Quality review procedures should be established at each site in order to fi nd errors prior 

to fi ling returns.

For questions A-14 through A-20, select the most correct response and record your 

answers on the answer sheet located in the front of the retest booklet.

A-14 Which of the following is an acceptable substitute for the original Social Security Card?

a. A copy of last year’s return

b. An original Form W-2 or Form 1099-Misc

c. A typed list showing names and social security numbers

d. A letter showing the information from the Social Security Administration

e. None of the above

A-15 Which one of the following groupings contains only income that is considered taxable?

a. Gambling winnings, farm income, child support, rents received

b. Dividends, gambling winnings, workers’ compensation

c. Unemployment compensation, tips and gratuities

d. Back pay, commissions, workers’ compensation, notary fees.

e. None of the above

A-16 Which one of the following statements is true?

a. Earned Income Credit (EIC) is the only refundable credit.

b. The Credit for Child and Dependent Care Expenses is the only refundable credit.

c. Child Tax Credit is the only refundable credit.

d. Additional Child Tax Credit is the only refundable credit.

e. EIC and Additional Child Tax Credit are the only refundable credits.

A-17 Gerald and Kara are married but live apart. They fi le separate returns. Kara paid more 

than half the cost of keeping up her home for 2004. They lived apart beginning on 15 

February, 2004. May and Elizabeth, their two children, lived with Kara for the entire 

year. Kara claims both children as dependents on her federal income tax return. What is 

Kara’s most advantageous fi ling status?

a. Married Filing Separately

b. Head of Household

c. Single

d. Married Filing Jointly

e. None of the above
11

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

A-18 Which of the following can be reported on Schedule A?

a. Rent

b. Mortgage interest and real estate taxes

c. Insurance on the home

d. Repairs, utilities & food

e. Welfare payments

A-19 Which of the following items are deductible on Schedule A?

a. Home repairs and insurance

b. Self employed expenses

c. Gambling losses to the extent of gambling winnings

d. Personal legal expenses

e. None of the above

A-20 Which of the following statements regarding standard and itemized deductions is the 

most accurate and complete?

a. Most taxpayers have a choice of taking a standard deduction or itemizing

b. The standard deduction reduces the amount of taxable income

c. The standard deduction is not the same for all taxpayers

d. If itemized deductions are greater than the standard deduction, it is usually in the 

taxpayers best interest to take the itemized deduction.

e. All of the above

13

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

 PART B — Wage Earner

For questions B-1 through B-10, select the most correct response and record the 

answers on the answer sheet located in the front of the retest booklet.

B-1 Which of the following is considered earned income for the Earned Income Credit?

a. Alimony

b. Unemployment compensation

c. Workfare payments

d. Taxable scholarship not on a Form W-2

e. Disability paid by an employer prior to minimum retirement age

B-2 Richard and Ellen are Donald’s parents and cannot claim him as a dependent on their 

joint return. Donald’s Aunt June made the payment for his tuition and fees to a qualifi ed 

college. Donald is a full-time student in his senior year and received no scholarship or 

grant. Who is eligible to claim the education credit?

a. Donald

b. Richard and Ellen

c. June

d. Richard, Ellen, and Donald

e. Donald and June

B-3 In the above scenario can the lifetime learning credit be claimed?

a. Yes

b. No

B-4 Janice and Tom are divorced. Their son, Peter, is 10 and has lived with Tom for 2 years. 

Janice and Tom’s divorce decree gives Janice the right to claim Peter as a dependent. 

Who can claim Peter for Earned Income Credit?

a. Janice

b. Tom

c. Both Janice and Tom

d. Neither Janice nor Tom

e. Peter

B-5 Beth and her two children, both under 19 years of age, lived with her boyfriend, Marty 

for all of 2004. The children are not Marty’s children, but he provides support for them. 

Beth did not earn any income in 2004, but Marty earned $15,000 at his job. Can Marty 

claim the children for EIC?

a. Yes

b. No
14

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

B-6 Jackie is 66 years old and has a two-year-old grandchild who lives with her. They lived 

together in their Minneapolis apartment for all of 2004. Jackie made $15,000 at her job 

and had no other income besides her Social Security. Does she qualify for the EIC?

a. Yes

b. No

B-7 Carlos has three children, ages 12, 14, and 16. Carlos and the children all lived with his 

mother, Marissa during 2004. Marissa and Carlos both have earned income less than 

$19,000. Who can claim the children for the EIC?

a. Carlos

b. Marissa

c. Marissa and Carlos may agree to each claim different children

d. Any of the above

e. Neither Marissa nor Carlos

B-8 Which is not an eligibility requirement for claiming the EIC with a qualifying child?

a. Age of the child

b. Claiming the child as a dependent

c. Taxpayer having earned income

d. Child must live with taxpayer in United States

e. Relationship to the child

B-9 The maximum amount per child of Child Tax Credit is_________?

B-10 Jack and Tanisha are married. Their two daughters, 3-year-old Tamara and 15-year-old 

Alisa live with them. Which of the following is a qualifying expense for the Child and 

Dependent Care Credit?

a. Sending Tamara to a private elementary school.

b. Sending Tamara to an overnight summer camp.

c. Paying for after school care at the Sunrise Day Care for Tamara

d. Paying Alisa to care for Tamara

e. Paying for after school care at the Sunrise Day Care for Alisa
15

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

For questions B-11 through B-13, use the following scenario to complete a Form 1040 

through line 62 and a Form 8863. Do not calculate a tuition and fees deduction on Form 

1040, line 26. Select the most correct response and record your answers on the answer 

sheet located in the front of the retest booklet.

Charles Hamilton is an unmarried single father with a son, Brian, who is a full time student at 

the local university. Brian lives at home and is in his second year of college. The university 

classifi es him as a sophomore.

You ask if Brian had income to contribute to his support. Charles tells you he did not.

Social Security

XXX-XX-XXXX

This number has been established for

Charles Monroe Hamilton

Social Security

XXX-XX-XXXX

This number has been established for

Brian J Hamilton

Date of Birth:

Charles, February 14, 1960 Brian, June 19, 1983

You ask Charles if he wants to contribute to the Presidential Election Campaign Fund, and 

he says yes. When asked, Charles states he is a custodian at Drake High School and has no 

other income.
16

1

Control number

Retirement

plan Third-partysick pay Statutoryemployee

6

2

Employer’s name, address, and ZIP code

7 Allocated tips

Advance EIC payment

8

9 10

Wages, tips, other compensation Federal income tax withheld

Social security wages Social security tax withheld

11 12a

Employer’s state ID number

3 4

Employer identification number

Medicare wages and tips

Social security tips

13

5

Employee’s social security number

Employee’s first name and initial Nonqualified plans

Medicare tax withheld

15

14

16 17

Other

18

Employee’s address and ZIP code

State State wages, tips, etc. State income tax Locality name

Copy B—To Be Filed With Employee’s FEDERAL Tax Return.

This information is being furnished to the Internal Revenue Service.

Department of the Treasury—Internal Revenue Service

Form

Dependent care benefits

See instructions for box 12

a

b

c

d

e

f

W-2 Wage and Tax

Statement 20 40

OMB No. 1545-0008

Last name C

o

d

e

12b

C

o

d

e

12c

C

o

d

e

Local wages, tips, etc. 19 Local income tax 20

12d

C

o

d

e

Safe, accurate,

FAST! Use

Visit the IRS website

111223 at www.irs.gov.

XX-XXXXXXX

Drake High School

200 Third Street

Your City, State Zip

XXX-XX-XXXX

Charles Hamilton

224 W 83rd Street

Your City, State Zip

20,098.96 948.23

20,098.96 1,246.00

20,098.96 291.00

XX XX-XXXXXXX 20,098.96 201.00

✘

CORRECTED

FILER’S name, street address, city, state, ZIP code, and telephone number

Tuition

Statement

FILER’S Federal identification no. STUDENT’S social security number 3

Street address (including apt. no.)

2

City, state, and ZIP code

Service Provider/Acct. No. (opt.) 8

STUDENT’S name

Form 1098-T (keep for your records) Department of the Treasury - Internal Revenue Service

Check if at least

half-time student

9

Form 1098-T

OMB No. 1545-1574

Check if a graduate

student

Adjustments made for a

prior year

Amounts billed for

qualified tuition and

related expenses

Payments received for

qualified tuition and

related expenses

1

$

$

$

Copy B

For Student

This is important

tax information

and is being

furnished to the

Internal Revenue

Service.

4 Scholarships or grants

5 Adjustments to scholarships

or grants for a prior year

6 Check this box if the

amount in box 1 or 2

includes amounts for

an academic period

beginning JanuaryMarch 2005 

$

$

7 Reimbursements or refunds

of qualified tuition and

related expenses from an

insurance contract

$

2004

University of Lafayette

289 Fourth Street

Your City, State, and Zip Code

xx-xxxxxxx xxx-xx-xxxx

Brian Hamilton

224 W. 83rd St.

Your City, State, and Zip Code

1,950.00

✘

Date
17

Proof as of

June 18, 2004

(subject to change)

Department of the Treasury—Internal Revenue Service 1040 U.S. Individual Income Tax Return

For the year Jan. 1–Dec. 31, 2004, or other tax year beginning , 2004, ending , 20 OMB No. 1545-0074

Your first name and initial Last name Your social security number

(See

instructions

on page 19.)

L

A

B

E

L

H

E

R

E

If a joint return, spouse’s first name and initial Last name Spouse’s social security number

Use the IRS

label.

Otherwise,

please print

or type.

Home address (number and street). If you have a P.O. box, see page 19. Apt. no.

City, town or post office, state, and ZIP code. If you have a foreign address, see page 19.

Presidential

Election Campaign

1 Single

Filing Status 2 Married filing jointly (even if only one had income)

Check only

one box.

3

Qualifying widow(er) with dependent child (see page 20)

6a Yourself. If someone can claim you as a dependent, do not check box 6a

Exemptions b Spouse

(4) if qualifying

child for child tax

credit (see page 21)

c Dependents: (2) Dependent’s

social security number

(3) Dependent’s

relationship to (1) First name Last name you

If more than four

dependents, see

page 21.

d Total number of exemptions claimed

7 Wages, salaries, tips, etc. Attach Form(s) W-2 7

Income 8a Taxable interest. Attach Schedule B if required 8a

b Tax-exempt interest. Do not include on line 8a 8b Attach

Forms W-2 and

W-2G here.

Also attach

Form(s) 1099-R

if tax was

withheld.

9a Ordinary dividends. Attach Schedule B if required 9a

10 Taxable refunds, credits, or offsets of state and local income taxes (see page 23) 10

11 Alimony received 11

12 Business income or (loss). Attach Schedule C or C-EZ 12

Enclose, but do

not attach, any

payment. Also,

please use

Form 1040-V.

13 Capital gain or (loss). Attach Schedule D if required. If not required, check here  13

14 Other gains or (losses). Attach Form 4797 14

15a IRA distributions 15a 15b b Taxable amount (see page 25)

16a Pensions and annuities 16a b Taxable amount (see page 25) 16b

17 Rental real estate, royalties, partnerships, S corporations, trusts, etc. Attach Schedule E 17

18 Farm income or (loss). Attach Schedule F 18

19 Unemployment compensation 19

20a Social security benefits 20a b Taxable amount (see page 27) 20b

21 21

22 Add the amounts in the far right column for lines 7 through 21. This is your total income  22

IRA deduction (see page 29) 25

23

27

26

One-half of self-employment tax. Attach Schedule SE

29

Self-employed health insurance deduction (see page 33)

27

30

29

Self-employed SEP, SIMPLE, and qualified plans

31

30

Penalty on early withdrawal of savings

32

31

Alimony paid b Recipient’s SSN 

Add lines 23 through 34a 35

32

Subtract line 35 from line 22. This is your adjusted gross income 

33

Adjusted

Gross

Income

36

If you did not

get a W-2,

see page 22. Form

Married filing separately. Enter spouse’s SSN above

and full name here. 

Cat. No. 11320B





Label

Form 1040 (2004)

IRS Use Only—Do not write or staple in this space.

Head of household (with qualifying person). (See page 20.) If

the qualifying person is a child but not your dependent, enter

this child’s name here. 

Other income. List type and amount (see page 27)

Moving expenses. Attach Form 3903

25

26

For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see page 77.

Boxes checked

on 6a and 6b

No. of children

on 6c who:

Dependents on 6c

not entered above

Add numbers on

lines above 

● lived with you

● did not live with

you due to divorce

or separation

(see page 21)

34a 34a

Student loan interest deduction (see page 31)

33

35

  Important!

Yes No

Note. Checking “Yes” will not change your tax or reduce your refund.

Do you, or your spouse if filing a joint return, want $3 to go to this fund? 

You must enter

your SSN(s) above.

No Yes

You Spouse

(See page 19.)

(99)

Tuition and fees deduction (see page 32)

36

4

5

Deduction for clean-fuel vehicles (see page 29) 23

b Qualified dividends (see page 23) 9b

2004

24 Certain business expenses of reservists, performing artists, and

fee-basis government officials. Attach Form 2106 or 2106-EZ 24

28 Health savings account deduction. Attach Form 8889 28
18

Proof as of

June 18, 2004

(subject to change)

Itemized deductions (from Schedule A) or your standard deduction (see left margin)

Add lines 63 through 69. These are your total payments 

Form 1040 (2004) Page 2

37 Amount from line 36 (adjusted gross income) 37

Check

if:

38a

Tax and

Credits

38a

Single or

Married filing

separately,

$4,850

If you are married filing separately and your spouse itemizes deductions, or

you were a dual-status alien, see page 34 and check here 

b

38b

39 39

40 Subtract line 39 from line 37 40

41

If line 37 is $107,025 or less, multiply $3,100 by the total number of exemptions claimed on

line 6d. If line 37 is over $107,025, see the worksheet on page 35

41

42 Taxable income. Subtract line 41 from line 40. If line 41 is more than line 40, enter -0- 42

43 43

47

48

53

Education credits. Attach Form 8863

46

51

Other credits. Check applicable box(es):

50

55

56

Add lines 46 through 54. These are your total credits

50

Subtract line 55 from line 45. If line 55 is more than line 45, enter -0- 

55

Self-employment tax. Attach Schedule SE

56

Other

Taxes

57

71

Social security and Medicare tax on tip income not reported to employer. Attach Form 4137

Additional tax on IRAs, other qualified retirement plans, etc. Attach Form 5329 if required 59

58

60

Add lines 56 through 61. This is your total tax 

61 61

63 Federal income tax withheld from Forms W-2 and 1099 63

64 2004 estimated tax payments and amount applied from 2003 return 64

Payments

65

Amount paid with request for extension to file (see page 56) 68

67

Excess social security and tier 1 RRTA tax withheld (see page 56) 66

68

70

69 Other payments from:

72a 72a

73 73

If line 70 is more than line 62, subtract line 62 from line 70. This is the amount you overpaid

74 74

Amount of line 71 you want refunded to you 

Refund

75

Amount of line 71 you want applied to your 2005 estimated tax 

Estimated tax penalty (see page 58)

Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and

belief, they are true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.

75

You were born before January 2, 1940, Blind.

Spouse was born before January 2, 1940, Blind.

a Form 3800

b Form 8801 c Specify

a Form 2439 b Form 4136

59

Household employment taxes. Attach Schedule H

60

69

Amount

You Owe

Sign

Here Your signature Date

Keep a copy

for your

records.

Spouse’s signature. If a joint return, both must sign. Date

Date Preparer’s SSN or PTIN Preparer’s

signature Check if

self-employed

Paid

Preparer’s

Use Only Firm’s name (or

yours if self-employed),

address, and ZIP code

EIN

Phone no.







Your occupation

Tax (see page 36). Check if any tax is from:

Amount you owe. Subtract line 70 from line 62. For details on how to pay, see page 57 

b

Direct deposit?

See page 56

and fill in 72b,

72c, and 72d.

Routing number

Account number

c Checking Savings

a Form(s) 8814 Form 4972

b

d





70

49

46

Retirement savings contributions credit. Attach Form 8880

57

58

Advance earned income credit payments from Form(s) W-2

71



Child tax credit (see page 40)

49 Credits from:

53

51

Additional child tax credit. Attach Form 8812

66

67

Head of

household,

$7,150

Married filing

jointly or

Qualifying

widow(er),

$9,700

Standard

Deduction

for—

Joint return?

See page 20.

Daytime phone number

( )

Earned income credit (EIC)

Credit for the elderly or the disabled. Attach Schedule R

44

45

47

Alternative minimum tax (see page 38). Attach Form 6251

Add lines 43 and 44 

Credit for child and dependent care expenses. Attach Form 2441

48

If you have a

qualifying

child, attach

Schedule EIC.

44

45

65

Spouse’s occupation

( )

Form 1040 (2004)

● People who

checked any

box on line

38a or 38b or

who can be

claimed as a

dependent,

see page 34.

● All others:

Designee’s

name 

Do you want to allow another person to discuss this return with the IRS (see page 58)? Third Party

Designee Phone

no.  ( )

Yes. Complete the following. No

Personal identification

number (PIN) 

54

Foreign tax credit. Attach Form 1116 if required

54

a Form 8396 b Form 8859

52 52

Adoption credit. Attach Form 8839

62 62

Type:

c Form 8885

Total boxes  checked 
19

Proof as of

June 18, 2004

(subject to change)

OMB No. 1545-1618 Education Credits

Form 8863

 See instructions. Department of the Treasury

Internal Revenue Service

Attachment

Sequence No. 50

Name(s) shown on return Your social security number

Hope Credit. Caution: You cannot take the Hope credit for more than 2 tax years for the same student.

1

2

3

Lifetime Learning Credit

Form 8863 (2004)

Part I

Part II

3

(a) Student’s name

(as shown on page 1

of your tax return)

Cat. No. 25379M

Add the amounts in columns (d) and (f)

Tentative Hope credit. Add the amounts on line 2, columns (d) and (f). If you are taking

the lifetime learning credit for another student, go to Part II; otherwise, go to Part III 

8

Add the amounts on line 4, column (c), and enter the total

9

9

Enter the smaller of line 5 or $10,000

10

Subtract line 10 from line 9. If zero or less, stop; you cannot take

any education credits

10

12

16

19

4

11

11

15

For Paperwork Reduction Act Notice, see page 3.

(f) Enter one-half

of the amount in

column (e)

(e) Subtract

column (d) from

column (c)

(d) Enter the

smaller of the

amount in

column (c) or

$1,000

(c) Qualified

expenses (see

instructions). Do

not enter more

than $2,000 for

each student.

2

Caution: You

cannot take the

Hope credit and

the lifetime learning

credit for the same

student in the

same year.

(a) Student’s name (as shown on page 1

of your tax return)

First name Last name

(c) Qualified

expenses (see

instructions)

Tentative lifetime learning credit. Multiply line 6 by 20% (.20) and go to Part III 

5

6

7

5

6

7

Part III Allowable Education Credits

8 Tentative education credits. Add lines 3 and 7

Enter: $105,000 if married filing jointly; $52,000 if single, head of

household, or qualifying widow(er)

Enter the amount from Form 1040, line 37*, or Form 1040A, line 22

If line 11 is equal to or more than line 12, enter the amount from line 8 on line 14 and

go to line 15. If line 11 is less than line 12, divide line 11 by line 12. Enter the result as

a decimal (rounded to at least three places)

13

14 Multiply line 8 by line 13 

Enter the amount from Form 1040, line 43, or Form 1040A, line 28 (minus any alternative

minimum tax included on Form 1040A, line 28) 

15

18

19 Subtract line 18 from line 15. If zero or less, stop; you cannot take any education credits 

20 Education credits. Enter the smaller of line 14 or line 19 here and on Form 1040,

line 48, or Form 1040A, line 31  20

14

13  .

(Hope and Lifetime Learning Credits)

(b) Student’s

social security

number (as

shown on page 1

of your tax return)

(b) Student’s social security

number (as shown on page

1 of your tax return)

Enter: $20,000 if married filing jointly; $10,000 if single, head of

household, or qualifying widow(er) 12

*See Pub. 970 for the amount to enter if you are filing Form 2555, 2555-EZ, or 4563 or you are excluding income from Puerto Rico.

 Attach to Form 1040 or Form 1040A.

Last name

First name

Caution: You cannot take both an education credit and the tuition and fees deduction (Form 1040, line 27, or Form 1040A, 

line 19) for the same student in the same year.

2004

Add lines 16 and 17

17

18

Enter the amount from Form 6251, line 31

16

17

Enter the total, if any, of your credits from Form 1040, lines 46

and 47, or Form 1040A, lines 29 and 30

21

B-11 What is the amount of tentative education credits (Form 8863, line 8)?

a. $390

b. $980

c. $1,370

d. $1,475

e. $1,500

B-12 What is amount of total tax (Form 1040, line 62)?

a. 0

b. $375

c. $675

d. $804

e. $973

B-13 Does Brian qualify Charles for the EIC?

a. Yes

b. No

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

23

For questions B-14 through B-19, use the following scenario to complete a Form 1040 

and appropriate worksheets, forms, and schedules. Select the most correct response 

and record your answers on the answer sheet located in the front of the retest booklet.

Margarita is an unmarried single parent. She provides all the support for her children, Pedro 

and Tina, who live with her.

Social Security

XXX-XX-XXXX

This number has been established for

Margarita I Loras

Social Security

XXX-XX-XXXX

This number has been established for

Pedro M Loras

Social Security

XXX-XX-XXXX

This number has been established for

Tina A Loras

Dates of Birth:

Margarita, October 4, 1960 Pedro, April 6, 1998 Tina, May 7, 2000

Margarita says she is a photographer. She states that her current address is the same as the 

one on her check and would like her refund directly deposited in the bank.

She gives you two income documents. When you ask her, she says she has no additional 

income. After looking at her documents, you ask her if her EIC was disallowed or reduced in 

the past two years and she tells you that it was not.

Margarita tells you she does not want to contribute to the Presidential Election Campaign.

During the interview, you determine she does not qualify for any adjustments to her total 

income. You also review her expenses and determine she cannot itemize and therefore will 

take the standard deduction.

Margarita states she did not forfeit any of her dependent care benefi ts.

After being asked, she also states she did not receive any distributions from her retirement plan.

1

Control number

Retirement

plan

Third-party

sick pay

Statutory

employee

6

2

Employer’s name, address, and ZIP code

7 Allocated tips

Advance EIC payment

8

9 10

Wages, tips, other compensation Federal income tax withheld

Social security wages Social security tax withheld

11 12a

Employer’s state ID number

3 4

Employer identification number

Medicare wages and tips

Social security tips

13

5

Employee’s social security number

Employee’s first name and initial Nonqualified plans

Medicare tax withheld

15

14

16 17

Other

18

Employee’s address and ZIP code

State State wages, tips, etc. State income tax Locality name

Copy B—To Be Filed With Employee’s FEDERAL Tax Return.

This information is being furnished to the Internal Revenue Service.

Department of the Treasury—Internal Revenue Service

Form

Dependent care benefits

See instructions for box 12

a

b

c

d

e

f

W-2 Wage and Tax

Statement 20 40

OMB No. 1545-0008

Last name C

o

d

e

12b

C

o

d

e

12c

C

o

d

e

Local wages, tips, etc. 19 Local income tax 20

12d

C

o

d

e

Safe, accurate,

FAST! Use

Visit the IRS website

1122333 at www.irs.gov.

XX-XXXXXXX

Hesston Magazine

200 E Third Street

Your City, State Zip

XXX-XX-XXXX

Margarita Loras

155 W First Street

Your City, State Zip

19,084.66 1,248.22

21,609.66 1,340.00

21,609.66 313.00

810.00 1,000.00

D 2,525.00

XX XX-XXXXXXX 19,084.66 191.00

✘
24

CORRECTED (if checked)

PAYER’S name, street address, city, state, ZIP code, and telephone no. OMB No. 1545-0112 Payer’s RTN (optional)

Interest Income

PAYER’S Federal identification number RECIPIENT’S identification number 1 Interest income not included in box 3

$

Early withdrawal penalty Interest on U.S. Savings

Bonds and Treas. obligations

RECIPIENT’S name 2 3

$ $

Street address (including apt. no.) 4 Federal income tax withheld

$

Foreign country or U.S.

possession

City, state, and ZIP code 6 Foreign tax paid 7

Account number (optional)

$

Form 1099-INT Department of the Treasury - Internal Revenue Service

Copy B

For Recipient

This is important tax

information and is

being furnished to the

Internal Revenue

Service. If you are

required to file a return,

a negligence penalty or

other sanction may be

imposed on you if this

income is taxable and

the IRS determines that

it has not been

reported.

(keep for your records)

Form 1099-INT

5 Investment expenses

$

2004 Bank of Greenville

1255 E 18th Street

Your City, State ZIP

XX-XXXXXXX XXX-XX-XXXX

Margarita I Loras

155 W First Street

Your City, State ZIP

11111222334

85.71

Margarita Loras

155 W. First Street

Your City, State Zip Code

$ PAY TO THE

ORDER OF

DOLLARS

Bank of Greenville

For

| xxxxxxxxx | 0011111222334 1234

VOID

Laredo Child Care

5540 Wilson Dr.

Your City, State ZIP

XX-XXXXXXX

Amounts Received:

January 1, 2004 $800

April 1, 2004 $800

July 1, 2004 $800

October 1, 2004 $800

Total amount received from Margarita Loras for the care of Pedro and Tina is: $3200

1234
25

Proof as of

June 18, 2004

(subject to change)

Department of the Treasury—Internal Revenue Service 1040 U.S. Individual Income Tax Return

For the year Jan. 1–Dec. 31, 2004, or other tax year beginning , 2004, ending , 20 OMB No. 1545-0074

Your first name and initial Last name Your social security number

(See

instructions

on page 19.)

L

A

B

E

L

H

E

R

E

If a joint return, spouse’s first name and initial Last name Spouse’s social security number

Use the IRS

label.

Otherwise,

please print

or type.

Home address (number and street). If you have a P.O. box, see page 19. Apt. no.

City, town or post office, state, and ZIP code. If you have a foreign address, see page 19.

Presidential

Election Campaign

1 Single

Filing Status 2 Married filing jointly (even if only one had income)

Check only

one box.

3

Qualifying widow(er) with dependent child (see page 20)

6a Yourself. If someone can claim you as a dependent, do not check box 6a

Exemptions b Spouse

(4) if qualifying

child for child tax

credit (see page 21)

c Dependents: (2) Dependent’s

social security number

(3) Dependent’s

relationship to (1) First name Last name you

If more than four

dependents, see

page 21.

d Total number of exemptions claimed

7 Wages, salaries, tips, etc. Attach Form(s) W-2 7

Income 8a Taxable interest. Attach Schedule B if required 8a

b Tax-exempt interest. Do not include on line 8a 8b Attach

Forms W-2 and

W-2G here.

Also attach

Form(s) 1099-R

if tax was

withheld.

9a Ordinary dividends. Attach Schedule B if required 9a

10 Taxable refunds, credits, or offsets of state and local income taxes (see page 23) 10

11 Alimony received 11

12 Business income or (loss). Attach Schedule C or C-EZ 12

Enclose, but do

not attach, any

payment. Also,

please use

Form 1040-V.

13 Capital gain or (loss). Attach Schedule D if required. If not required, check here  13

14 Other gains or (losses). Attach Form 4797 14

15a IRA distributions 15a 15b b Taxable amount (see page 25)

16a Pensions and annuities 16a b Taxable amount (see page 25) 16b

17 Rental real estate, royalties, partnerships, S corporations, trusts, etc. Attach Schedule E 17

18 Farm income or (loss). Attach Schedule F 18

19 Unemployment compensation 19

20a Social security benefits 20a b Taxable amount (see page 27) 20b

21 21

22 Add the amounts in the far right column for lines 7 through 21. This is your total income  22

IRA deduction (see page 29) 25

23

27

26

One-half of self-employment tax. Attach Schedule SE

29

Self-employed health insurance deduction (see page 33)

27

30

29

Self-employed SEP, SIMPLE, and qualified plans

31

30

Penalty on early withdrawal of savings

32

31

Alimony paid b Recipient’s SSN 

Add lines 23 through 34a 35

32

Subtract line 35 from line 22. This is your adjusted gross income 

33

Adjusted

Gross

Income

36

If you did not

get a W-2,

see page 22. Form

Married filing separately. Enter spouse’s SSN above

and full name here. 

Cat. No. 11320B





Label

Form 1040 (2004)

IRS Use Only—Do not write or staple in this space.

Head of household (with qualifying person). (See page 20.) If

the qualifying person is a child but not your dependent, enter

this child’s name here. 

Other income. List type and amount (see page 27)

Moving expenses. Attach Form 3903

25

26

For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see page 77.

Boxes checked

on 6a and 6b

No. of children

on 6c who:

Dependents on 6c

not entered above

Add numbers on

lines above 

● lived with you

● did not live with

you due to divorce

or separation

(see page 21)

34a 34a

Student loan interest deduction (see page 31)

33

35

  Important!

Yes No

Note. Checking “Yes” will not change your tax or reduce your refund.

Do you, or your spouse if filing a joint return, want $3 to go to this fund? 

You must enter

your SSN(s) above.

No Yes

You Spouse

(See page 19.)

(99)

Tuition and fees deduction (see page 32)

36

4

5

Deduction for clean-fuel vehicles (see page 29) 23

b Qualified dividends (see page 23) 9b

2004

24 Certain business expenses of reservists, performing artists, and

fee-basis government officials. Attach Form 2106 or 2106-EZ 24

28 Health savings account deduction. Attach Form 8889 28
26

Proof as of

June 18, 2004

(subject to change)

Itemized deductions (from Schedule A) or your standard deduction (see left margin)

Add lines 63 through 69. These are your total payments 

Form 1040 (2004) Page 2

37 Amount from line 36 (adjusted gross income) 37

Check

if:

38a

Tax and

Credits

38a

Single or

Married filing

separately,

$4,850

If you are married filing separately and your spouse itemizes deductions, or

you were a dual-status alien, see page 34 and check here 

b

38b

39 39

40 Subtract line 39 from line 37 40

41

If line 37 is $107,025 or less, multiply $3,100 by the total number of exemptions claimed on

line 6d. If line 37 is over $107,025, see the worksheet on page 35

41

42 Taxable income. Subtract line 41 from line 40. If line 41 is more than line 40, enter -0- 42

43 43

47

48

53

Education credits. Attach Form 8863

46

51

Other credits. Check applicable box(es):

50

55

56

Add lines 46 through 54. These are your total credits

50

Subtract line 55 from line 45. If line 55 is more than line 45, enter -0- 

55

Self-employment tax. Attach Schedule SE

56

Other

Taxes

57

71

Social security and Medicare tax on tip income not reported to employer. Attach Form 4137

Additional tax on IRAs, other qualified retirement plans, etc. Attach Form 5329 if required 59

58

60

Add lines 56 through 61. This is your total tax 

61 61

63 Federal income tax withheld from Forms W-2 and 1099 63

64 2004 estimated tax payments and amount applied from 2003 return 64

Payments

65

Amount paid with request for extension to file (see page 56) 68

67

Excess social security and tier 1 RRTA tax withheld (see page 56) 66

68

70

69 Other payments from:

72a 72a

73 73

If line 70 is more than line 62, subtract line 62 from line 70. This is the amount you overpaid

74 74

Amount of line 71 you want refunded to you 

Refund

75

Amount of line 71 you want applied to your 2005 estimated tax 

Estimated tax penalty (see page 58)

Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and

belief, they are true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.

75

You were born before January 2, 1940, Blind.

Spouse was born before January 2, 1940, Blind.

a Form 3800

b Form 8801 c Specify

a Form 2439 b Form 4136

59

Household employment taxes. Attach Schedule H

60

69

Amount

You Owe

Sign

Here Your signature Date

Keep a copy

for your

records.

Spouse’s signature. If a joint return, both must sign. Date

Date Preparer’s SSN or PTIN Preparer’s

signature Check if

self-employed

Paid

Preparer’s

Use Only Firm’s name (or

yours if self-employed),

address, and ZIP code

EIN

Phone no.







Your occupation

Tax (see page 36). Check if any tax is from:

Amount you owe. Subtract line 70 from line 62. For details on how to pay, see page 57 

b

Direct deposit?

See page 56

and fill in 72b,

72c, and 72d.

Routing number

Account number

c Checking Savings

a Form(s) 8814 Form 4972

b

d





70

49

46

Retirement savings contributions credit. Attach Form 8880

57

58

Advance earned income credit payments from Form(s) W-2

71



Child tax credit (see page 40)

49 Credits from:

53

51

Additional child tax credit. Attach Form 8812

66

67

Head of

household,

$7,150

Married filing

jointly or

Qualifying

widow(er),

$9,700

Standard

Deduction

for—

Joint return?

See page 20.

Daytime phone number

( )

Earned income credit (EIC)

Credit for the elderly or the disabled. Attach Schedule R

44

45

47

Alternative minimum tax (see page 38). Attach Form 6251

Add lines 43 and 44 

Credit for child and dependent care expenses. Attach Form 2441

48

If you have a

qualifying

child, attach

Schedule EIC.

44

45

65

Spouse’s occupation

( )

Form 1040 (2004)

● People who

checked any

box on line

38a or 38b or

who can be

claimed as a

dependent,

see page 34.

● All others:

Designee’s

name 

Do you want to allow another person to discuss this return with the IRS (see page 58)? Third Party

Designee Phone

no.  ( )

Yes. Complete the following. No

Personal identification

number (PIN) 

54

Foreign tax credit. Attach Form 1116 if required

54

a Form 8396 b Form 8859

52 52

Adoption credit. Attach Form 8839

62 62

Type:

c Form 8885

Total boxes  checked 
27

Proof as of

June 18, 2004

(subject to change)

OMB No. 1545-0068 Child and Dependent Care Expenses Form 2441

 Attach to Form 1040.

Department of the Treasury

Internal Revenue Service

Attachment

 See separate instructions. Sequence No. 21

Name(s) shown on Form 1040 Your social security number

Persons or Organizations Who Provided the Care—You must complete this part. 

(If you need more space, use the bottom of page 2.)

(b) Address

(number, street, apt. no., city, state, and ZIP code)

(d) Amount paid

(see instructions)

(c) Identifying number

(SSN or EIN) 1 (a) Care provider’sname

Credit for Child and Dependent Care Expenses

2

Add the amounts in column (c) of line 2. Do not enter more than $3,000 for one qualifying

person or $6,000 for two or more persons. If you completed Part III, enter the amount

from line 34

Enter your earned income

3

3

If married filing jointly, enter your spouse’s earned income (if your spouse was a student

or was disabled, see the instructions); all others, enter the amount from line 4

4 4

Enter the smallest of line 3, 4, or 5

5

5

6

7 Enter the amount from Form 1040, line 37 7



Decimal

amount is

If line 7 is:

Decimal

amount is

If line 7 is:

But not

Over over But notOver over

$0—15,000 .35 $29,000—31,000 .27

15,000—17,000 .34 31,000—33,000 .26

17,000—19,000 .33 33,000—35,000 .25

19,000—21,000 .32 35,000—37,000 .24

21,000—23,000 .31 37,000—39,000 .23

23,000—25,000 .30

Multiply line 6 by the decimal amount on line 8. If you paid 2003 expenses in 2004, see

the instructions 

9

For Paperwork Reduction Act Notice, see page 3 of the instructions. Form 2441 (2004)

Before you begin: You need to understand the following terms. See Definitions on page 1 of the instructions.

Cat. No. 11862M

Part I

Part II

Enter on line 8 the decimal amount shown below that applies to the amount on line 7

Did you receive

dependent care benefits? Yes

No

8

Complete only Part II below.

Complete Part III on the back next.





Caution. If the care was provided in your home, you may owe employment taxes. See the instructions for Form 1040, line 61.

.

(99)

Information about your qualifying person(s). If you have more than two qualifying persons, see the instructions.

(a) Qualifying person’s name

First Last

(b) Qualifying person’s social

security number

(c) Qualified expenses you

incurred and paid in 2004 for the

person listed in column (a)

8

6

● Dependent Care Benefits ● Qualifying Person(s) ● Qualified Expenses ● Earned Income

12 Subtract line 11 from line 10. If zero or less, stop. You cannot take the credit 

Credit for child and dependent care expenses. Enter the smaller of line 9 or line 12

here and on Form 1040, line 46

13

9

12

13

25,000—27,000

27,000—29,000

.29

.28

39,000—41,000

41,000—43,000

43,000—No limit

.22

.21

.20

10

11

10

11

Enter the amount from Form 1040, line 43

Enter the amount, if any, from Form 6251, line 31 (see

the instructions)

2004
28

Proof as of

June 18, 2004

(subject to change)

Form 2441 (2004) Page 2

Dependent Care Benefits

Enter the total amount of dependent care benefits you received in 2004. Amounts you

received as an employee should be shown in box 10 of your Form(s) W-2. Do not include

amounts reported as wages in box 1 of Form(s) W-2. If you were self-employed or a

partner, include amounts you received under a dependent care assistance program from

your sole proprietorship or partnership

Enter the amount forfeited, if any (see the instructions)

Subtract line 15 from line 14

Enter the total amount of qualified expenses incurred

in 2004 for the care of the qualifying person(s)

15

17

Enter the smaller of line 16 or 17 18

16

Enter your earned income

17

19

Enter the amount shown below that

applies to you.

20

Enter the smallest of line 18, 19, or 20

18

21

Enter the amount from line 14 that you received from your sole proprietorship or

partnership. If you did not receive any such amounts, enter -0-

19

22

Taxable benefits. Subtract line 28 from line 23. If zero or less, enter -0-. Also, include

this amount on Form 1040, line 7. On the dotted line next to line 7, enter “DCB”

20

29

Part III

To claim the child and dependent care

credit, complete lines 30–34 below.

30

31

32

21

22

29

30 Enter $3,000 ($6,000 if two or more qualifying persons)

Subtract line 31 from line 30. If zero or less, stop. You cannot take the credit.

Exception. If you paid 2003 expenses in 2004, see the instructions for line 9

Enter the smaller of line 32 or 33. Also, enter this amount on line 3 on the front of this

form and complete lines 4–13

Add lines 25 and 28

34

31

32

34

15

16

Printed on recycled paper

14

14

Complete line 2 on the front of this form. Do not include in column (c) any benefits shown

on line 31 above. Then, add the amounts in column (c) and enter the total here

33

33

Form 2441 (2004)

● If married filing jointly, enter your

spouse’s earned income (if your spouse

was a student or was disabled, see the

instructions for line 5).

● If married filing separately, see the

instructions for the amount to enter.

● All others, enter the amount from line 19. 

23 Subtract line 22 from line 16

Enter $5,000 ($2,500 if married filing separately and you were required to enter your

spouse’s earned income on line 20)

24

Deductible benefits. Enter the smallest of line 21, 22, or 24. Also, include this amount

on the appropriate line(s) of your return (see the instructions)

25

26 Enter the smaller of line 21 or 24

27 Enter the amount from line 25

28 Excluded benefits. Subtract line 27 from line 26. If zero or less, enter -0-

26

27

23

24

25

28
29

Proof as of

June 18, 2004

(subject to change)

Form 1040—Line 51

placement agency for legal adoption even if the adoption is not Line 51—Child Tax Credit final. An authorized placement agency includes any person or court

authorized by state law to place children for legal adoption.

What Is the Child Tax Credit?

Questions Who Must Use This credit is for people who have a qualifying child (defined Pub. 972 below). It is in addition to the credit for child and dependent care

Pub.

972

expenses on Form 1040, line 46, and the earned income credit on

Form 1040, line 65. 1. Are you excluding income from Puerto Rico or are you

filing any of the following forms?

Three Steps To Take the Child Tax Credit! • Form 2555 or 2555-EZ (relating to foreign earned income)

• Form 4563 (exclusion of income for residents of Step 1. Make sure you have a qualifying child for the child American Samoa)

tax credit (defined below). No. Continue Yes.



STOP Step 2. Make sure you checked the box on Form 1040, line

6c, column (4), for each qualifying child. You must use Pub. 972 to

figure your credit. Step 3. Answer the questions on this page to see if you

may use the worksheet on page 41 to figure your

credit or if you must use Pub. 972, Child Tax 2. Is the amount on Form 1040, line 37, more than the amount

Credit. If you need Pub. 972, see page 7. shown below for your filing status?

• Married filing jointly – $110,000

• Single, head of household, or qualifying widow(er) –

Qualifying Child for Child Tax Credit $75,000

A qualifying child for purposes of the child tax credit is a child who: • Married filing separately – $55,000

No. Continue Yes.



STOP 1. Is claimed as your dependent on line 6c, and

2. Was under age 17 at the end of 2004, and You must use Pub. 972 to

figure your credit. 3. Is your (a) son, daughter, adopted child, stepchild, or a

descendant of any of them (for example, your grandchild);

(b) brother, sister, stepbrother, stepsister, or a descendant of 3. Are you claiming any of the following credits?

any of them (for example, your niece or nephew), whom • Retirement savings contributions credit, Form 8880 (see you cared for as you would your own child; or (c) foster the instructions for Form 1040, line 52, on page 42) child (any child placed with you by an authorized place- • Adoption credit, Form 8839 (see the instructions for Form ment agency whom you cared for as you would your own 1040, line 53, on page 42) child), and

4. Is a U.S. citizen or resident alien. No. Use the Yes. You must use 

worksheet on page 38 Pub. 972 to figure your

The above requirements are not the same as the require- to figure your child child tax credit. You will

ments to be a qualifying child for the earned income tax credit. also need the form(s) listed

credit. above for any credit(s) you CAUTION

!

are claiming.

An adopted child is always treated as your own child. An

adopted child includes a child placed with you by an authorized

- 37 - Need more information or forms? See page 7.
30

Proof as of

June 18, 2004

(subject to change)

Form 1040—Line 51

Child Tax Credit Worksheet—Line 51

1040

Yes. STOP

● To be a qualifying child for the child tax credit, the child must be under age 17 at the end

of 2004 and meet the other requirements listed on page 40.

● Do not use this worksheet if you answered “Yes” to question 1, 2, or 3 on page 40. Instead, use Pub. 972.

1.

4.

5.

Number of qualifying children: $1,000. 1

Enter the result.



Are the amounts on lines 2 and 3 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 below. TIP

No. Subtract line 3 from line 2.

Is the amount on line 1 more than the amount on line 4?

Yes. Enter the amount from line 4.

Also, you may be able to take the

additional child tax credit. See the

TIP below.

No. Enter the amount from line 1.

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 67, if you answered “Yes” on line 4 or

line 5 above.

● First, complete your Form 1040 through line 66.

● Then, use Form 8812 to figure any additional child tax

credit.

4

 5



2. Enter the amount from Form 1040, line 45. 2

3. Add the amounts from Form 1040:

3

Keep for Your Records

TIP

CAUTION

Line 46

Line 47 +

Line 48 +

Line 49 +

Line 50 + Enter the total.

Need more information or forms? See page 7. - 38 -
31

Proof as of

June 18, 2004

(subject to change)

Form 1040—Line 65

Line 65 Step 2 Investment Income Earned Income Credit (EIC) 1. Add the amounts from 

What Is the EIC? Form 1040:

The EIC is a credit for certain people who work. The credit may Line 8a

give you a refund even if you do not owe any tax. Line 8b +

To Take the EIC: Line 9a +

• Follow the steps below. Line 13* +

• 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 Investment Income =

Schedule EIC.

*Do not include if line 13 is a loss. If you take the EIC even though you are not eligible and

it is determined that your error is due to reckless or 2. Is your investment income more than $2,650? intentional disregard of the EIC rules, you will not be Yes. Continue No. Skip question 3; go to



CAUTION

!

allowed to take the credit for 2 years even if you are question 4. otherwise eligible to do so. If you fraudulently take the EIC, you

will not be allowed to take the credit for 10 years. You may also

have to pay penalties. 3. Are you filing Form 4797 (relating to sales of business

property)?

Yes. See Form 4797 No. STOP Step 1 All Filers filers on page 46. You cannot take the credit.

1. If, in 2004:

• 2 children lived with you, is the amount on Form 1040, 4. Do any of the following apply for 2004? line 37, less than $34,458 ($35,458 if married filing • You are filing Schedule E. jointly)? • You are reporting income or a loss from the rental of • 1 child lived with you, is the amount on Form 1040, line personal property not used in a trade or business. 37, less than $30,338 ($31,338 if married filing jointly)? • You are reporting income on Form 1040, line 21, from • No children lived with you, is the amount on Form 1040, Form 8814 (relating to election to report child’s interest line 37, less than $11,490 ($12,490 if married filing and dividends). jointly)?

Yes. You must use No. Continue

 Yes. Continue No.



STOP Worksheet 1 in Pub.

You cannot take the credit. 596 to see if you can

take the credit. To get

Pub. 596, see page 7. 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 (see page 47)? 5. Did a child live with you in 2004?

Yes. Continue No. Yes. Go to Step 3 No. Go to Step 4 on



STOP

on page 45. page 45. You cannot take the credit.

Put “No” on the dotted line

next to line 65.

3. Is your filing status married filing separately?

Yes. No. STOP Continue

You cannot take the 

credit.

4. Are you filing Form 2555 or 2555-EZ (relating to foreign

earned income)?

Yes. No. STOP Continue

 (Continued on page 45) You cannot take the

credit.

5. Were you a nonresident alien for any part of 2004?

Yes. See Nonresident No. Go to Step 2.

aliens on page 47.

- 41 - Need more information or forms? See page 7.
32

Proof as of

June 18, 2004

(subject to change)

Form 1040—Line 65

Continued from page 44

3. Does the child meet the conditions to be a qualifying child

of any other person (other than your spouse if filing a joint Step 3 Qualifying Child return) for 2004?

Yes. SeeQualifying No. This child is your

child of more than one qualifying child. The child

person on must have a valid social A qualifying child is a child who is your... page 47. security number as defined

on page 47 unless the child

Son, daughter, adopted child, stepchild, or a descendant of was born and died in 2004.

any of them (for example, your grandchild) Skip Step 4; go to Step 5

or on page 46.

Brother, sister, stepbrother, stepsister, or a descendant of any

of them (for example, your niece or nephew), whom you

cared for as you would your own child Step 4 Filers Without a Qualifying Child

or 1. Look at the qualifying child conditions in Step 3. Could Foster child (any child placed with you by an authorized you, or your spouse if filing a joint return, be a qualifying placement agency whom you cared for as you would your child of another person in 2004? own child) Yes. No. STOP Continue

You cannot take the 

credit. Put “No” on 

the dotted line next to 

AND

line 65.

was at the end of 2004...

2. Can you, or your spouse if filing a joint return, be claimed Under age 19 as a dependent on someone else’s 2004 tax return?

or Yes. No. STOP Continue

Under age 24 and a student (see page 47) You cannot take the 

credit. or

Any age and permanently and totally disabled (see page 47) 3. Were you, or your spouse if filing a joint return, at least age

25 but under age 65 at the end of 2004?

Yes. Continue No.



STOP

You cannot take the credit.

AND

who...

4. Was your home, and your spouse’s if filing a joint return, in

Lived with you in the United States for more than half the United States for more than half of 2004? Members of

of 2004. the military stationed outside the United States, see page 47

before you answer. If the child did not live with you for the

required time, see Exception to “time lived with you” Yes. Go to Step 5 No. STOP

condition on page 46. on page 46. You cannot take the credit.

Put “No” on the dotted line

next to line 65.

CAUTION

! If the child was married, see page 47.

1. Look at the qualifying child conditions above. Could you, or

your spouse if filing a joint return, be a qualifying child of

another person in 2004?

Yes. No. STOP Continue

You cannot take the 

credit. Put “No” on 

the dotted line next to

line 65.

(Continued on page 46)

2. Do you have at least one child who meets the above conditions to be your qualifying child?

Yes. Go to No. Skip the next two

question 3. questions; go to Step 4,

question 2.

Need more information or forms? See page 7. - 42 -
33

Proof as of

June 18, 2004

(subject to change)

Form 1040—Line 65

Continued from page 45

Step 5 Earned Income Step 6 How To Figure the Credit

1. Are you filing Schedule SE because you were a member of 1. Do you want the IRS to figure the credit for you?

the clergy or you had church employee income of $108.28 Yes. See Credit No. Go to Worksheet A or more? figured by the IRS on on page 48.

Yes. See Clergy or No. Continue



this page.

Church employees,

whichever applies, on Definitions and Special Rules this page. (listed in alphabetical order)

2. Figure earned income: Adopted child. An adopted child is always treated as your own

child. An adopted child includes a child placed with you by an

authorized placement agency for legal adoption even if the adoption Form 1040, line 7 is not final. An authorized placement agency includes any person or

Subtract, if included on line 7, any: court authorized by state law to place children for legal adoption.

• Taxable scholarship or fellowship grant Church employees. Determine how much of the amount on not reported on a Form W-2. Form 1040, line 7, was also reported on Schedule SE, line 5a. • Amount paid to an inmate in a penal Subtract that amount from the amount on Form 1040, line 7, and institution for work (put “PRI” and the enter the result in the first space of Step 5, line 2. Be sure to answer

amount subtracted on the dotted line next “Yes” on Step 5, line 3.

to Form 1040, line 7). Clergy. The following instructions apply to ministers, members of • Amount received as a pension or annuity religious orders who have not taken a vow of poverty, and Christian

from a nonqualified deferred – Science practitioners. If you are filing Schedule SE and the amount

compensation plan or a nongovernmental on line 2 of that schedule includes an amount that was also reported

section 457 plan (put “DFC” and the on Form 1040, line 7:

amount subtracted on the dotted line next} 1. Put “Clergy” on the dotted line next to Form 1040, line 65. to Form 1040, line 7). This amount may 2. Determine how much of the amount on Form 1040, line 7, be shown in Form W-2, box 11. If you was also reported on Schedule SE, line 2. received such an amount but box 11 is 3. Subtract that amount from the amount on Form 1040, blank, contact your employer for the line 7. Enter the result in the first space of Step 5, line 2. amount received as a pension or annuity. 4. Be sure to answer “Yes” to question 3 in Step 5.

Earned Income = Credit figured by the IRS. To have the IRS figure the credit for

you: 3. Were you self-employed, or are you filing Schedule SE be- • Put “EIC” on the dotted line next to Form 1040, line 65. cause you were a member of the clergy or you had church • If you have a qualifying child, complete and attach Sched- employee income, or are you filing Schedule C or C-EZ as a ule EIC. If your EIC for a year after 1996 was reduced or statutory employee? disallowed, see Form 8862, Who must file below.

Yes. Skip question 4 No. Continue

and Step 6; go to  Exception to “time lived with you” condition. A child is conWorksheet B on sidered to have lived with you for all of 2004 if the child was born page 49. or died in 2004 and your home was this child’s home for the entire

time he or she was alive in 2004. Temporary absences, such as for

school, vacation, medical care, or detention in a juvenile facility, 4. If you have: count as time lived at home. If your child is presumed to have been • 2 or more qualifying children, is your earned income less kidnapped by someone who is not a family member, see Pub. 596 to than $34,458 ($35,458 if married filing jointly)? find out if that child is a qualifying child for the EIC. To get Pub. • 1 qualifying child, is your earned income less than 596, see page 7. If you were in the military stationed outside the $30,338 ($31,338 if married filing jointly)? United States, see Members of the military on page 47.

• No qualifying children, is your earned income less than

$11,490 ($12,490 if married filing jointly)? Form 4797 filers. If the amount on Form 1040, line 13, includes

an amount from Form 4797, you must use Worksheet 1 in Pub. 596 Yes. Go to Step 6. No. STOP to see if you can take the EIC. To get Pub. 596, see page 7.

You cannot take the credit. 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.

1. After your EIC was reduced or disallowed in an earlier

year (a) you filed Form 8862 (or other documents) and

your EIC was then allowed, and (b) your EIC has not been

- 43 - Need more information or forms? See page 7.
34

Proof as of

June 18, 2004

(subject to change)

Form 1040—Line 63

reduced or disallowed again for any reason other than a • If none of the persons is the child’s parent, the child will be

math or clerical error. treated as the qualifying child of the person who had the

highest AGI for 2004. 2. You are taking the EIC without a qualifying child and the

only reason your EIC was reduced or disallowed in the The child must have a valid social security number as defined on

earlier year was because it was determined that a child this page unless the child was born and died in 2004. If you do not

listed on Schedule EIC was not your qualifying child. have a qualifying child, stop; you cannot take the EIC. Put “No” on

the dotted line next to line 65. If you have a qualifying child, skip Also, do not file Form 8862 or take the credit for 2 years if it was Step 4; go to Step 5 on page 46. determined that your error was due to reckless or intentional disregard of the EIC rules (10 years if due to fraud). Example. You and your 5-year-old daughter moved in with

your mother in April 2004. You are not a qualifying child of your

Married child. A child who was married at the end of 2004 is a mother. Your daughter meets the conditions to be a qualifying child

qualifying child only if (a) you can claim him or her as your for both you and your mother. If you and your mother cannot agree

dependent on Form 1040, line 6c, or (b) this child’s other parent on who will treat your daughter as a qualifying child, the rules

claims him or her as a dependent under the rules in Pub. 501 for above apply. Under these rules, you are entitled to treat your daughchildren of divorced or separated parents. ter as a qualifying child because you are the child’s parent. Your

mother would not be entitled to claim any EIC unless she has a Members of the military. If you were on extended active duty different qualifying child. outside the United States, your home is considered to be in the

United States during that duty period. Extended active duty is Social security number (SSN). For purposes of taking the EIC, a military duty ordered for an indefinite period or for a period of more valid SSN is a number issued by the Social Security Administration than 90 days. Once you begin serving extended active duty, you are unless “Not Valid for Employment” is printed on the social security considered to be on extended active duty even if you serve fewer card and the number was issued solely to apply for or receive a than 90 days. federally funded benefit.

Nonresident aliens. If your filing status is married filing jointly, To find out how to get an SSN, see page 15. If you will not have

go to Step 2 on page 44. Otherwise, stop; you cannot take the EIC. an SSN by April 15, 2005, see What if You Cannot File on Time?

on page 12.

Permanently and totally disabled child. A child who cannot Student. A child who during any 5 months of 2004: engage in any substantial gainful activity because of a physical or • Was enrolled as a full-time student at a school, or mental condition and a doctor has determined that this condition: • Took a full-time, on-farm training course given by a school or • Has lasted or can be expected to last continuously for at a state, county, or local government agency. least a year, or

A school includes technical, trade, and mechanical schools. It • Can lead to death. does not include on-the-job training courses, correspondence

Qualifying child of more than one person. schools, or night schools. If the child meets

the conditions to be a qualifying child of more than one person, only Welfare benefits, effect of credit on. Any refund you receive as one person can take the EIC based on that child. The other person(s) a result of taking the EIC will not be used to determine if you are cannot take the EIC for people without a qualifying child, but may eligible for the following programs or how much you can receive take the EIC based on a different qualifying child. If you and the from them. But if the refund you receive because of the EIC is not other person(s) cannot agree who will take the EIC, then the follow- spent within a certain period of time, it may count as an asset (or ing rules apply. resource) and affect your eligibility. • If only one of the persons is the child’s parent, the child • Temporary Assistance for Needy Families (TANF). will be treated as the qualifying child of the parent. • Medicaid and supplemental security income (SSI). • If both persons are the child’s parents, the child will be

treated as the qualifying child of the parent with whom the • Food stamps and low-income housing.

child lived for the longer period of time during 2004. If the

child lived with each parent for the same amount of time,

the child will be treated as the qualifying child of the parent

who had the higher adjusted gross income (AGI) for 2004.

Need more information or forms? See page 7. - 44 -
35

Proof as of

June 18, 2004

(subject to change)

Form 1040—Line 63

Worksheet —Earned Income Credit (EIC)—Line 65 A

1040

Yes. Skip line 5; enter the amount from line 2 on line 6.

STOP

Keep for Your Records

Before you begin: Be sure you are using the correct worksheet. Do not use this worksheet if you

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. Instead, use Worksheet B that begins on page 49.

1.

2.

3.

4.

5.

Enter your earned income from Step 5 on page 46. 1

Look up the amount on line 1 above in the EIC Table on pages 51–55

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 the amount from Form 1040, line 37.

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 on

pages 51–55 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 65.

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

If line 2 is zero, You cannot take the credit.

Put “No” on the dotted line next to line 65.

● No qualifying children, is the amount on line 3 less than $6,400

($7,400 if married filing jointly)?

● 1 or more qualifying children, is the amount on line 3 less than

$14,050 ($15,050 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

page 46 to find out if you must file Form 8862 to take the credit for

2004.

  

EIC

1040



CAUTION

- 45 - Need more information or forms? See page 7.
36

Proof as of

June 18, 2004

(subject to change)

 OMB No. 1545-0074 SCHEDULE EIC Earned Income Credit (Form 1040A or 1040)

Department of the Treasury

Internal Revenue Service

Attachment

Sequence No. 43

Qualifying Child Information

For Paperwork Reduction Act Notice, see Form 1040A

or 1040 instructions.

Cat. No. 13339M Schedule EIC (Form 1040A or 1040) 2004

Before you begin: See the instructions for Form 1040A, line 41, or Form 1040, line 65, to make sure that

(a) you can take the EIC and (b) you have a qualifying child.

Qualifying Child Information

● It will take us longer to process your return and issue your refund if you do not fill in all lines that apply

for each qualifying child.

4

2

5

6

1 Child’s name

Child’s SSN

Child’s relationship to you

Number of months child lived with

you in the United States during 2004

months

Yes.

months

If the child was born before 1986—

Was the child permanently and totally

disabled during any part of 2004?

b

Yes.

First name Last name First name Last name

Name(s) shown on return Your social security number

(99)

EIC

1040A

1040

Complete and attach to Form 1040A or 1040

only if you have a qualifying child.

● Be sure the child’s name on line 1 and social security number (SSN) on line 2 agree with the child’s

social security card. Otherwise, at the time we process your return, we may reduce or disallow your EIC.

If the name or SSN on the child’s social security card is not correct, call the Social Security

Administration at 1-800-772-1213.

Child 1 Child 2

If you have more than two qualifying children, you

only have to list two to get the maximum credit.

The child must have an SSN as defined on page 43

of the Form 1040A instructions or page 47 of the

Form 1040 instructions unless the child was born and

died in 2004. If your child was born and died in 2004

and did not have an SSN, enter “Died” on this line

and attach a copy of the child’s birth certificate.

No. No.

Go to line 5. Go to line 5. Continue Continue

Yes. Yes. No. No.

Continue Continue The child is not a

qualifying child.

The child is not a

qualifying child.

● If the child lived with you for more than half of

2004 but less than 7 months, enter “7”.

● If the child was born or died in 2004 and your

home was the child’s home for the entire time he or

she was alive during 2004, enter “12”.

Do not enter more than 12 months. Do not enter more than 12 months.

You may also be able to take the additional child tax credit if your child (a) was under age 17 at the end of 2004, (b) is

claimed as your dependent on line 6c of Form 1040A or Form 1040, and (c) is a U.S. citizen or resident alien. For more

details, see the instructions for line 42 of Form 1040A or line 67 of Form 1040.

. . . . . . . . . .

● If you take the EIC even though you are not eligible, you may not be allowed to take the credit for up

to 10 years. See back of schedule for details.

(for example, son, daughter, grandchild,

niece, nephew, foster child, etc.)

Was the child under age 24 at the end

of 2004 and a student?

a

Child’s year of birth

If born after 1985, skip lines 4a

and 4b; go to line 5.

Year

If born after 1985, skip lines 4a

and 4b; go to line 5.

Year

2004

3

CAUTION

TIP
37

Proof as of

June 18, 2004

(subject to change)

OMB No. 1545-1620 8812 Additional Child Tax Credit Form

Complete and attach to Form 1040 or Form 1040A. Department of the Treasury

Internal Revenue Service

Attachment

Sequence No. 47

Name(s) shown on return Your social security number

For Paperwork Reduction Act Notice, see back of form. Cat. No. 10644E Form 8812 (2004)

3

2

4

6

Enter the total of the withheld social security and Medicare taxes from Form(s)

W-2, boxes 4 and 6. If married filing jointly, include your spouse’s amounts

with yours. If you worked for a railroad, see the instructions on back

Add lines 7 and 8

1

Enter the total of the amounts from Form 1040, lines

30 and 58, plus any uncollected social security and

Medicare or tier 1 RRTA taxes included on line 62.

Enter -0-.

Enter the total of the amounts from Form 1040, lines

65 and 66.

Enter the total of the amount from Form 1040A, line

41, plus any excess social security and tier 1 RRTA

taxes withheld that you entered to the left of line 43

(see the instructions on back).

Enter the amount from line 1 of your Child Tax Credit Worksheet on page 41 of the Form 1040 instructions

or page 38 of the Form 1040A instructions. If you used Pub. 972, enter the amount from line 8 of the

worksheet on page 4 of the publication

Enter the amount from Form 1040, line 51, or Form 1040A, line 32

Subtract line 2 from line 1. If zero, stop; you cannot take this credit

8

9



6

 1040A filers:

1040 filers:

1040 filers:

1040A filers:

1

2

13

1040 .

1040A . . . . . . . . . Enter this amount on

Form 1040, line 67, or

Form 1040A, line 42.





8812

1040

1040A

. . . . . . . . . .

3

Enter your total taxable earned income. See the instructions on back

5 Is the amount on line 4 more than $10,750?

No.

Yes. Subtract $10,750 from the amount on line 4. Enter the result

Leave line 5 blank and enter -0- on line 6.

4

5

Multiply the amount on line 5 by 10% (.10) and enter the result

7

Next. Do you have three or more qualifying children?

No. If line 6 is zero, stop; you cannot take this credit. Otherwise, skip Part II and enter the

smaller of line 3 or line 6 on line 13.

Yes.

7

8

9

10

10

11 Subtract line 10 from line 9. If zero or less, enter -0- 11

12 Enter the larger of line 6 or line 11 here 12

Next, enter the smaller of line 3 or line 12 on line 13.

13 This is your additional child tax credit

Part III

Part I

Part II

All Filers

Certain Filers Who Have Three or More Qualifying Children

Your Additional Child Tax Credit

If line 6 is equal to or more than line 3, skip Part II and enter the amount from line 3 on

line 13. Otherwise, go to line 7.

(99)

2004
38

Proof as of

June 18, 2004

(subject to change)

Form 8812 (2004) Page 2

Instructions

Purpose of Form

Use Form 8812 to figure your additional child tax credit.

Taxable Earned Income

Paperwork Reduction Act Notice. We ask for the information on

this form to carry out the Internal Revenue laws of the United

States. You are required to give us the information. We need it to

ensure that you are complying with these laws and to allow us to

figure and collect the right amount of tax.

You are not required to provide the information requested on a

form that is subject to the Paperwork Reduction Act unless the

form displays a valid OMB control number. Books or records

relating to a form or its instructions must be retained as long as

their contents may become material in the administration of any

Internal Revenue law. Generally, tax returns and return information

are confidential, as required by Internal Revenue Code section

6103.

The time needed to complete and file this form will vary

depending on individual circumstances. The estimated average time

is: Recordkeeping, 6 min.; Learning about the law or the form,

5 min.; Preparing the form, 28 min.; Copying, assembling, and

sending the form to the IRS, 20 min.

If you have comments concerning the accuracy of these time

estimates or suggestions for making this form simpler, we would

be happy to hear from you. See the Instructions for Form 1040 or

Form 1040A.

The additional child tax credit may give you a refund

even if you do not owe any tax.

Railroad Employees

If you worked for a railroad, include the following taxes in the

total on Form 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 and tier 1 Medicare tax you paid for 2004.

Any refund you receive as a result of taking the additional child

tax credit will not be used to determine if you are eligible for the

following programs, or how much you can receive from them.

● Temporary Assistance for Needy Families (TANF).

● Medicaid and supplemental security income (SSI).

● Food stamps and low-income housing.

Effect of Credit on Welfare Benefits

First, complete the Child Tax Credit Worksheet that applies to you.

See the instructions for Form 1040, line 51, or Form 1040A, line

32. If you meet the condition given in the TIP at the end of your

Child Tax Credit Worksheet, use Form 8812 to see if you can take

the additional child tax credit.

Who Should Use Form 8812

2. Are you claiming the earned income credit (EIC) on Form

1040, line 65, or Form 1040A, line 41?

Yes. Use the following chart to find the amount to enter on

Form 8812, line 4.

IF you are

filing Form . . . AND you completed . . .

THEN enter on Form

8812, line 4, the amount

from . . .

1040A

1040

Step 5 on page 42 of your

1040A instructions

Worksheet B on page 49 of

your 1040 instructions

Step 5 on page 46 of your

1040 instructions (but not

Worksheet B)

Step 5, Earned Income

Worksheet B, line 4b.*

Step 5, Earned Income

No. 1040 filers: Go to question 3.

1040A filers: Skip question 3 and go to question 4.

Yes. Use Pub. 972 to figure the amount to enter on

Form 8812, line 4.

4. Does the amount on line 7 of Form 1040 or Form 1040A

include any of the following amounts?

● Taxable scholarship or fellowship grants not reported on a Form

W-2.

● Amounts paid to an inmate in a penal institution for work (enter

“PRI” and the amount paid in the space next to line 7 of Form

1040 or 1040A).

No. Enter the amount from line 7 of Form 1040 or Form

1040A on Form 8812, line 4.

Yes. Subtract the total of those amounts from the amount on

line 7 of Form 1040 or Form 1040A. (If an amount is

included in more than one of the above categories,

include it only once in figuring the total amount to

subtract.) Enter the result on Form 8812, line 4.

1040A Filers

If you, or your spouse if filing a joint return, had more than one

employer for 2004 and total wages of over $87,900, figure any

excess social security and tier 1 railroad retirement (RRTA) taxes

withheld. See the instructions for Form 1040A, line 43. Include any

excess on Form 8812, line 10.

* If you were a member of the clergy, subtract the following from the amount on line

4b: (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.

● Amounts received as a pension or annuity from a nonqualified

deferred compensation plan or a nongovernmental section 457 plan

(enter “DFC” and the amount received in the space next to line 7

of Form 1040 or 1040A). This amount may be reported 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.

● Amounts from Form 2555, line 41, or Form 2555-EZ,

line 18.

1. Did you, or your spouse if filing a joint return, have net

earnings from self-employment and use either optional method to

figure those net earnings?

No. Go to question 2.

Yes. Use Pub. 972 to figure the amount to enter on

Form 8812, line 4.

3. Were you, or your spouse if filing a joint return,

self-employed, 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?

No. Go to question 4.

TIP
39

Proof as of

June 18, 2004

(subject to change)

OMB No. 1545-1805

8880 Credit for Qualified Retirement Savings Contributions Form

Department of the Treasury

Internal Revenue Service

Attachment

Sequence No. 129

 Attach to Form 1040 or Form 1040A. 

Name(s) shown on return Your social security number

For Paperwork Reduction Act Notice, see back of form. Cat. No. 33394D Form 8880 (2004)

● The amount on Form 1040, line 37, or Form 1040A, line 22, is more than $25,000 ($37,500 if head of household;

$50,000 if married filing jointly).

You cannot take this credit if either of the following applies.

4

1

Traditional and Roth IRA contributions for 2004. Do not include rollover

contributions

1

3

2

5

6

7

8

9

10

11

12

13

14

Elective deferrals to a 401(k) or other qualified employer plan, voluntary

employee contributions, and 501(c)(18)(D) plan contributions for 2004

(see instructions) 

2

3 Add lines 1 and 2

Certain distributions received after 2001 and before the due date

(including extensions) of your 2004 tax return (see instructions). If

married filing jointly, include both spouses’ amounts in both columns.

See instructions for an exception 

4

5 Subtract line 4 from line 3. If zero or less, enter -0-

6 In each column, enter the smaller of line 5 or $2,000 

8 Enter the amount from Form 1040, line 37*, or Form 1040A, line 22

9 Enter the applicable decimal amount shown below:

Note: If line 9 is zero, stop; you cannot take this credit.

10 Multiply line 7 by line 9 

11 Enter the amount from Form 1040, line 45, or Form 1040A, line 28

Enter the total of your credits from Form 1040, lines 46 through 51, or

Form 1040A, lines 29 through 32

12

13 Subtract line 12 from line 11. If zero, stop; you cannot take this credit 

Credit for qualified retirement savings contributions. Enter the smaller of line 10 or line

13 here and on Form 1040, line 52, or Form 1040A, line 33

14

(a) You (b) Your spouse

● The person(s) who made the qualified contribution or elective deferral (a) was born after January 1, 1987, (b) is

claimed as a dependent on someone else’s 2004 tax return, or (c) was a student (see instructions).

7 Add the amounts on line 6. If zero, stop; you cannot take this credit 

*See Pub. 590 for the amount to enter if you are filing Form 2555, 2555-EZ, or 4563 or you are excluding income from Puerto Rico.

If line 8 is— 

Enter on line 9—

Single, Married filing 

separately, or 

Qualifying widow(er)

Over— But not 

over—

Married

filing jointly

Head of 

household

---

$15,000

$16,250

$22,500

$24,375

$25,000

$30,000

$32,500

$37,500

$50,000

$15,000

$16,250

$22,500

$24,375

$25,000

$30,000

$32,500

$37,500

$50,000

---

.5

.5

.5

.5

.5

.5

.2

.1

.1

.0

.5

.5

.5

.2

.1

.1

.1

.1

.0

.0

.5

.2

.1

.1

.1

.0

.0

.0

.0

.0

X .

And your filing status is—

 See instructions on back.

2004

CAUTION

41

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

B-14 What is the amount on Form 2441 Line 3?

a. $1,500

b. $2,200

c. $3,200

d. $4,000

e. $5,000

B-15 What is the amount on Form 2441 Line 8?

a. 0.35

b. 0.32

c. 0.31

d. 0.25

e. 0.20

B-16 Which of Margarita’s children qualify her for the Child Tax Credit?

a. Pedro

b. Tina

c. Both Pedro and Tina

d. Neither Pedro nor Tina

B-17 What is the total tax amount (Form 1040, Line 62)?

a. 0

b. $410

c. $565

d. $675

e. $810

B-18 What is the Earned Income Tax Credit amount (Form 1040, Line 65)?

a. $3,250

b. $3,240

c. $3,229

d. $3,219

e. $3,208
42

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

B-19 What is the Additional Child Tax Credit amount (Form 1040, Line 67)?

a. $470

b. $675

c. $834

d. $1,530

e. $2,000
43

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

For question B-20, complete a Form 8863. Select the most correct response and record 

your answer on the answer sheet located in the front of the retest booklet.

B-20 In 2004, Jana Davis completed her junior year of business administration. Her tuition 

for 2004 was $3,000. She received a scholarship that covered $1,000 and she had to 

borrow the other $2,000. If all other credit requirements are met, what are her tentative 

education credits (Form 8863: line 8)?

a. $400

b. $600

c. $1,500

d. $200

e. 0

45

Proof as of

June 18, 2004

(subject to change)

OMB No. 1545-1618 Education Credits

Form 8863

 See instructions. Department of the Treasury

Internal Revenue Service

Attachment

Sequence No. 50

Name(s) shown on return Your social security number

Hope Credit. Caution: You cannot take the Hope credit for more than 2 tax years for the same student.

1

2

3

Lifetime Learning Credit

Form 8863 (2004)

Part I

Part II

3

(a) Student’s name

(as shown on page 1

of your tax return)

Cat. No. 25379M

Add the amounts in columns (d) and (f)

Tentative Hope credit. Add the amounts on line 2, columns (d) and (f). If you are taking

the lifetime learning credit for another student, go to Part II; otherwise, go to Part III 

8

Add the amounts on line 4, column (c), and enter the total

9

9

Enter the smaller of line 5 or $10,000

10

Subtract line 10 from line 9. If zero or less, stop; you cannot take

any education credits

10

12

16

19

4

11

11

15

For Paperwork Reduction Act Notice, see page 3.

(f) Enter one-half

of the amount in

column (e)

(e) Subtract

column (d) from

column (c)

(d) Enter the

smaller of the

amount in

column (c) or

$1,000

(c) Qualified

expenses (see

instructions). Do

not enter more

than $2,000 for

each student.

2

Caution: You

cannot take the

Hope credit and

the lifetime learning

credit for the same

student in the

same year.

(a) Student’s name (as shown on page 1

of your tax return)

First name Last name

(c) Qualified

expenses (see

instructions)

Tentative lifetime learning credit. Multiply line 6 by 20% (.20) and go to Part III 

5

6

7

5

6

7

Part III Allowable Education Credits

8 Tentative education credits. Add lines 3 and 7

Enter: $105,000 if married filing jointly; $52,000 if single, head of

household, or qualifying widow(er)

Enter the amount from Form 1040, line 37*, or Form 1040A, line 22

If line 11 is equal to or more than line 12, enter the amount from line 8 on line 14 and

go to line 15. If line 11 is less than line 12, divide line 11 by line 12. Enter the result as

a decimal (rounded to at least three places)

13

14 Multiply line 8 by line 13 

Enter the amount from Form 1040, line 43, or Form 1040A, line 28 (minus any alternative

minimum tax included on Form 1040A, line 28) 

15

18

19 Subtract line 18 from line 15. If zero or less, stop; you cannot take any education credits 

20 Education credits. Enter the smaller of line 14 or line 19 here and on Form 1040,

line 48, or Form 1040A, line 31  20

14

13  .

(Hope and Lifetime Learning Credits)

(b) Student’s

social security

number (as

shown on page 1

of your tax return)

(b) Student’s social security

number (as shown on page

1 of your tax return)

Enter: $20,000 if married filing jointly; $10,000 if single, head of

household, or qualifying widow(er) 12

*See Pub. 970 for the amount to enter if you are filing Form 2555, 2555-EZ, or 4563 or you are excluding income from Puerto Rico.

 Attach to Form 1040 or Form 1040A.

Last name

First name

Caution: You cannot take both an education credit and the tuition and fees deduction (Form 1040, line 27, or Form 1040A, 

line 19) for the same student in the same year.

2004

Add lines 16 and 17

17

18

Enter the amount from Form 6251, line 31

16

17

Enter the total, if any, of your credits from Form 1040, lines 46

and 47, or Form 1040A, lines 29 and 30

47

PART C — Pension Earner

For questions C-1 through C-3, select the most correct response and record your 

answers on the answer sheet located in the front of the retest booklet.

C-1 Linda sold 250 shares of Clemson Container Co. stock on August 1, 2004. Her gross 

proceeds were $8,300 and she paid a commission on the sale of $35. She purchased 

her shares through a company investment program in the 1980’s. She has a letter from 

her company indicating her cost for the shares was $650. What is her net capital gain/

loss on the sale?

a. $8,265

b. $7,615

c. $7,650

d. $8,300

e. $0

C-2 Joe tells you he purchased 150 shares of Asbury, Inc. stock for $5 per share in 1985. 

There were no adjustments to the basis since the stock was purchased. What is the 

basis of Joe’s stock?

a. 0

b. $150

c. $750

d. $900

e. None of the above

C-3 Dave hands you a Form 1099-B for the sale of 42 shares of Humboldt Life Insurance 

Company stock with net proceeds of $742. When you question Dave, he states he 

never bought any shares of Humboldt Life, but he’s had a Humboldt Life Insurance 

policy since he married 27 years ago. Which answer best describes Dave’s 

circumstance?

a. Dave does not have to report this transaction because it is not reported on a 

Form 1099DIV.

b. Dave must report this transaction and his taxable gain is $0.

c. Dave must report this transaction and his taxable long-term gain is $742.

d. Dave must report this transaction and his taxable short-term gain is $742.

e. None of the above

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet
48

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

For question C-4, complete the simplified method worksheet. Select the most correct 

response and record your answer on the answer sheet located in the front of the retest 

booklet.

C-4 Peter is single and retired from the Dickinson Company on December 31, 2003 at 

age 55. He gives you his Form 1099-R. Peter states he began receiving his pension in 

January, 2004, and has received monthly payments ever since.

What is the taxable portion of Peter’s pension? (Simplifi ed Method Worksheet, line 9)

a. $16,622

b. $16,349

c. $16,624

d. $17,332

e. None of the above

Employee contributions

or insurance premiums

CORRECTED (if checked)

PAYER’S name, street address, city, state, and ZIP code 1 Gross distribution Distributions From

Pensions, Annuities,

Retirement or

Profit-Sharing

Plans, IRAs,

Insurance

Contracts, etc.

$

2a Taxable amount

$

Total

distribution

Taxable amount

not determined

2b

RECIPIENT’S identification

number

PAYER’S Federal identification

number

3 Capital gain (included

in box 2a)

4 Federal income tax

withheld

$ $

RECIPIENT’S name Net unrealized

appreciation in

employer’s securities

5 6

$ $

Distribution

code(s)

Street address (including apt. no.) 7 8 Other

%

City, state, and ZIP code

Account number (optional) 10 State tax withheld 11 State/Payer’s state no.

$

13 Local tax withheld 14 Name of locality

$

Form 1099-R Department of the Treasury - Internal Revenue Service

12

15

State distribution

Local distribution

$

Copy B

Report this

income on your

Federal tax

return. If this

form shows

Federal income

tax withheld in

box 4, attach

this copy to

your return.

This information is

being furnished to

the Internal

Revenue Service.

$

$

$

$ $

$

OMB No. 1545-0119

Your percentage of total

distribution

9a

%

Form 1099-R

9b Total employee contributions

$

IRA/

SEP/

SIMPLE

2004

Dickinson Company

259 North 99th Terrace

Your City, State, and Zip Code

17,332.00

✘

xx-xxxxxxx xxx-xx-xxxx

Peter Martin

731 East 49th Street

Your City, State, and Zip Code 21,300.00
49

Proof as of

June 18, 2004

(subject to change)

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, see Pub. 939 to find out if you are entitled to a death

benefit exclusion of up to $5,000. If you are, include the exclusion 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 2004 on Form

1040, line 16a.

1. Enter the total pension or annuity payments received in 2004. Also, enter this amount on Form 1040,

line 16a . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .................1.

2. Enter your cost in the plan at the annuity starting date . . . . . . . . . . . . . . . . . . . . . 2.

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 . . . . . . . . . . . . . . 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 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9.

Table 1 for Line 3 Above

AND your annuity starting date was ó

IF the age at annuity starting before November 19, 1996, after November 18, 1996,

date (see page 27) was . . . enter on line3... enter on line3...

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 (see page 27) were . . . THEN enter on line 3 . . .

110 or under 410

111– 120 360

121– 130 310

131– 140 260

141 or older 210

- 23 - Need more information or forms? See page 7.

51

For questions C-5 through C-10, select the most correct response and record your 

answers on the answer sheet located in the front of the retest booklet.

C-5 Barbara brings you the following information to prepare her tax return: her Form 

SSA-1099; two Forms 1099-INT; and a Form 1099-DIV. Barbara’s date of birth is 

May 3, 1931. While you are preparing her tax return, what other information is 

essential to correctly prepare Barbara’s return?

a. Whether she has any IRA or 401K accounts

b. Barbara’s fi ling status and number of dependents

c. Whether she is legally blind

d. Answers a and b

e. Answers a, b, and c

C- 6 Under which of the following circumstances should you recommend that the taxpayer 

adjust the amount of withholding and/or estimated payments they will have for 2005?

a. Taxpayer had no tax liability for 2004 and has $150 per month withheld from his/her 

pension during 2004.

b. Taxpayer had dividend and interest income in addition to his/her pension and had no 

withholding during 2004. His tax liability was $2,350. Upon completing his return, you 

discover he/she must pay an Estimated Tax Penalty.

c. a and b

d. Taxpayer had withholding of $140 and estimated tax payments of $680 in 2004. He 

had a total tax liability in 2004 of $950.

e. Taxpayer had a Federal Tax Liability for 2003 of $0. In 2004, taxpayer had no 

withholding, paid no estimated taxes, and sold all his Series E savings bonds with a 

resulting tax liability of $1,700.

C-7 Sanford has the following sources of income for 2004:

• fully taxable annuity reported on Form 1099-R;

• fully taxable IRA distribution reported on Form 1099-R;

• Social Security Benefi ts reported on Form SSA-1099;

• Form 1099-INT with Box 1, Interest Income;

• Form W-2 with $3,100 in wages; and

• Form 1099-MISC with $150 in Non-Employee Compensation.

Which statement is correct?

a. He should report his pension and IRA distribution on the same line on his return 

because they were both reported on Form 1099-R.

b. He should report his pension and IRA distribution on his return because they were 

both fully taxable. He will need to complete the Social Security Benefi ts worksheet to 

determine if any of his benefi ts are taxable.

c. He does not have to report his wages because they are less than the amount that he 

is allowed to earn and still receive his full Social Security benefi t.

d. He does not have to report his Form 1099-MISC income because it is under $400.

e. None of the above.
52

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

C-8 Howard and Providence are married and lived together for the entire year of 2004. 

Howard elected to fi le as married fi ling separately. He received a Form SSA-1099 with a 

Box 5 amount of $7,000. Which of the following statements is correct?

a. 100% of his Social Security is taxable because he’s elected to fi le as Married Filing 

Separately.

b. The amount to be entered on Line 8 of the Social Security Benefi ts Worksheet is 

$32,000.

c. Line 8 of the Social Security Benefi ts Worksheet is left blank and 85% of his Social 

Security Benefi t is subject to tax.

d. The amount to be entered on Line 8 of the Social Security Benefi ts Worksheet should 

be $25,000.

e. None of the above.

C-9 Which transactions involving traditional IRA’s are permitted without penalties or 

additional taxes?

a. Taking distributions at age 57

b. Investing the IRA in artworks and rare wines

c. Rolling over assets within 90 days

d. Rolling over assets within one year

e. Taking two minimal annual distributions during the year in which the taxpayer reaches 

age 701⁄2

C-10 Which of the following income sources is fully taxable?

a. Interest in municipal bonds from the taxpayer’s state

b. Interest in municipal bonds from other than the taxpayer’s state

c. Dividends on insurance policies

d. Interest from U.S. Government HH Bonds

e. None of the above
53

For questions C-11 through C-13, use the following scenario to complete a Form 1040 

through line 36 and appropriate worksheets. Fill-in the blanks and record your answers 

on the answer sheet located in the front of the retest booklet.

George (born January 22, 1923) and Susan Vincennes (born June 2, 1928) are retired and 

fi ling a joint tax return. George retired from a railway career in 1983 when contributions were 

recovered in the fi rst one to three years of retirement. They both have Forms RRB-1099/1099R 

from the railroad. Susan’s RRB-1099 is blank. Susan has a Form 1099-R from her banking 

career and a Form SSA-1099 from Social Security.

They received $1,800 interest from Tulane Savings Bank. They also brought in a year-end 

statement from the Odessa Municipal Fund which shows tax-exempt interest received during 

the year of $1,100. They have no other income.

They both would like to contribute to the Presidential Election Campaign.

Employee contributions

or insurance premiums

CORRECTED (if checked)

PAYER’S name, street address, city, state, and ZIP code 1 Gross distribution Distributions From

Pensions, Annuities,

Retirement or

Profit-Sharing

Plans, IRAs,

Insurance

Contracts, etc.

$

2a Taxable amount

$

Total

distribution

Taxable amount

not determined

2b

RECIPIENT’S identification

number

PAYER’S Federal identification

number

3 Capital gain (included

in box 2a)

4 Federal income tax

withheld

$ $

RECIPIENT’S name Net unrealized

appreciation in

employer’s securities

5 6

$ $

Distribution

code(s)

Street address (including apt. no.) 7 8 Other

%

City, state, and ZIP code

Account number (optional) 10 State tax withheld 11 State/Payer’s state no.

$

13 Local tax withheld 14 Name of locality

$

Form 1099-R Department of the Treasury - Internal Revenue Service

12

15

State distribution

Local distribution

$

Copy B

Report this

income on your

Federal tax

return. If this

form shows

Federal income

tax withheld in

box 4, attach

this copy to

your return.

This information is

being furnished to

the Internal

Revenue Service.

$

$

$

$ $

$

OMB No. 1545-0119

Your percentage of total

distribution

9a

%

Form 1099-R

9b Total employee contributions

$

IRA/

SEP/

SIMPLE

2004

First National Savings Bank

345 North 7th Avenue

Your City, State and Zip Code

7,076.00

7,076.00

xx-xxxxxxx xxx-xx-xxxx

Susan Vincennes

2241 East 54th St.

0.00

Your City, State, and Zip Code

7
54

PAYER’S NAME, STREET ADDRESS, CITY, STATE, AND ZIP CODE

UNITED STATES RAILROAD RETIREMENT BOARD

844 N RUSH ST CHICAGO IL 60611-2092

PAYER’S FEDERAL IDENTIFYING NO. 36-3314600

1. Claim Number and Payee Code

2. Recipient’s Identification Number

Recipient’s Name, Street Address, City, State, and Zip Code

FORM RRB-1099

2004

3.

Social Security Equivalent Benefit

Portion of Tier 1 Repaid to RRB in 2004

Net Social Security Equivalent Benefit

Portion of Tier 1 Paid in 2004

Workers’ Compensation Offset in 2004

Social Security Equivalent Benefit

Portion of Tier 1 Paid for 2003

Social Security Equivalent Benefit

Portion of Tier 1 Paid for 2002

Social Security Equivalent Benefit

Portion of Tier 1 Paid for Years

Prior to 2000

Federal Income Tax Withheld

PAYMENTS BY THE 

RAILROAD RETIREMENT BOARD

DO NOT ATTACH TO YOUR INCOME TAX RETURN

Gross Social Security Equivalent Benefit

Portion of Tier 1 Paid in 2004

4.

5.

6.

7.

8.

9.

10.

COPY C -

FOR

RECIPIENT’S

RECORDS

THIS

INFORMATION

IS BEING

FURNISHED

TO THE

INTERNAL

REVENUE

SERVICE.

11. Medicare Premium Total

xxx-xx-xxxx

George Vincennes

2241 East 54th St.

Your City, State, and Zip Code

12,420.00

0.00

12,420.00

0.00

160.00 799.00

PAYERS’ NAME, STREET ADDRESS, CITY, STATE, AND ZIP CODE

UNITED STATES RAILROAD RETIREMENT BOARD

844 N RUSH ST CHICAGO IL 60611-2092

2004 ANNUITIES OR PENSIONS BY THE

RAILROAD RETIREMENT BOARD

PAYER’S FEDERAL IDENTIFYING NO. 36-3314600

FORM RRB-1099-R

COPY B -

REPORT THIS INCOME ON

YOUR FEDERAL TAX

RETURN. IF THIS FORM

SHOWS FEDERAL INCOME

TAX WITHHELD IN BOX 9

ATTACH THIS COPY TO

YOUR RETURN.

THIS INFORMATION IS BEING

FURNISHED TO THE INTERNAL

REVENUE SERVICE.

1.

2.

Claim Number and Payee Code

Recipient’s Identification Number

Recipient’s Name, Street Address, City, State, and ZIP Code

3.

4.

5.

6.

7.

8.

9.

10. 11.

Employee Contributions

Contributory Amount Paid

Vested Dual Benefit

Supplemental Annuity

Total Gross Paid

Repayments

Federal Income Tax

Withheld

Rate of Tax Country 12. Medicare Premium Total

xxx-xx-xxxx

George Vincennes

2241 East 54th Street

Your City, State, and 

Zip Code

9,832.00

680.00

10,512.00

0.00

PAYERS’ NAME, STREET ADDRESS, CITY, STATE, AND ZIP CODE

UNITED STATES RAILROAD RETIREMENT BOARD

844 N RUSH ST CHICAGO IL 60611-2092

2004 ANNUITIES OR PENSIONS BY THE

RAILROAD RETIREMENT BOARD

PAYER’S FEDERAL IDENTIFYING NO. 36-3314600

FORM RRB-1099-R

COPY B -

REPORT THIS INCOME ON

YOUR FEDERAL TAX

RETURN. IF THIS FORM

SHOWS FEDERAL INCOME

TAX WITHHELD IN BOX 9

ATTACH THIS COPY TO

YOUR RETURN.

THIS INFORMATION IS BEING

FURNISHED TO THE INTERNAL

REVENUE SERVICE.

1.

2.

Claim Number and Payee Code

Recipient’s Identification Number

Recipient’s Name, Street Address, City, State, and ZIP Code

3.

4.

5.

6.

7.

8.

9.

10. 11.

Employee Contributions

Contributory Amount Paid

Vested Dual Benefit

Supplemental Annuity

Total Gross Paid

Repayments

Federal Income Tax

Withheld

Rate of Tax Country 12. Medicare Premium Total

xxx-xx-xxxx

Susan Vincennes

2241 East 54th Street

Your City, State, and 

Zip Code

4,088.00

4,088.00

1,280.00
55

FORM SSA-1099 – SOCIAL SECURITY BENEFIT STATEMENT

2004 ● PART OF YOUR SOCIAL SECURITY BENEFITS SHOWN IN BOX 5 MAY BE TAXABLE INCOME.

● SEE THE REVERSE FOR MORE INFORMATION.

Box 1. Name Box 2. Beneficiary’s Social Security Number

Box 3. Benefits Paid in 2004 Box 4. Benefits Repaid to SSA in 2004 Box 5. Net Benefits for 2003 (Box 3 minus Box 4)

DESCRIPTION OF AMOUNT IN BOX 3 DESCRIPTION OF AMOUNT IN BOX 4

Box 7. Address

Box 8. Claim Number (Use this number if you need to contact SSA.)

Form SSA-1099-SM (1-2005) DO NOT RETURN THIS FORM TO SSA OR IRS

Box 6. Voluntary Federal Income Tax Withholding

Susan Vincennes xxx-xx-xxxx

9,280.00 0.00 9,280.00

Paid by check or 

direct deposit: $8,481.00

Medicare premiums 

deducted: $799.00

 Total: $9,280.00

0.00

2241 East 54th Street

Your City, State, and Zip Code

57

Proof as of

June 18, 2004

(subject to change)

Department of the Treasury—Internal Revenue Service 1040 U.S. Individual Income Tax Return

For the year Jan. 1–Dec. 31, 2004, or other tax year beginning , 2004, ending , 20 OMB No. 1545-0074

Your first name and initial Last name Your social security number

(See

instructions

on page 19.)

L

A

B

E

L

H

E

R

E

If a joint return, spouse’s first name and initial Last name Spouse’s social security number

Use the IRS

label.

Otherwise,

please print

or type.

Home address (number and street). If you have a P.O. box, see page 19. Apt. no.

City, town or post office, state, and ZIP code. If you have a foreign address, see page 19.

Presidential

Election Campaign

1 Single

Filing Status 2 Married filing jointly (even if only one had income)

Check only

one box.

3

Qualifying widow(er) with dependent child (see page 20)

6a Yourself. If someone can claim you as a dependent, do not check box 6a

Exemptions b Spouse

(4) if qualifying

child for child tax

credit (see page 21)

c Dependents: (2) Dependent’s

social security number

(3) Dependent’s

relationship to (1) First name Last name you

If more than four

dependents, see

page 21.

d Total number of exemptions claimed

7 Wages, salaries, tips, etc. Attach Form(s) W-2 7

Income 8a Taxable interest. Attach Schedule B if required 8a

b Tax-exempt interest. Do not include on line 8a 8b Attach

Forms W-2 and

W-2G here.

Also attach

Form(s) 1099-R

if tax was

withheld.

9a Ordinary dividends. Attach Schedule B if required 9a

10 Taxable refunds, credits, or offsets of state and local income taxes (see page 23) 10

11 Alimony received 11

12 Business income or (loss). Attach Schedule C or C-EZ 12

Enclose, but do

not attach, any

payment. Also,

please use

Form 1040-V.

13 Capital gain or (loss). Attach Schedule D if required. If not required, check here  13

14 Other gains or (losses). Attach Form 4797 14

15a IRA distributions 15a 15b b Taxable amount (see page 25)

16a Pensions and annuities 16a b Taxable amount (see page 25) 16b

17 Rental real estate, royalties, partnerships, S corporations, trusts, etc. Attach Schedule E 17

18 Farm income or (loss). Attach Schedule F 18

19 Unemployment compensation 19

20a Social security benefits 20a b Taxable amount (see page 27) 20b

21 21

22 Add the amounts in the far right column for lines 7 through 21. This is your total income  22

IRA deduction (see page 29) 25

23

27

26

One-half of self-employment tax. Attach Schedule SE

29

Self-employed health insurance deduction (see page 33)

27

30

29

Self-employed SEP, SIMPLE, and qualified plans

31

30

Penalty on early withdrawal of savings

32

31

Alimony paid b Recipient’s SSN 

Add lines 23 through 34a 35

32

Subtract line 35 from line 22. This is your adjusted gross income 

33

Adjusted

Gross

Income

36

If you did not

get a W-2,

see page 22. Form

Married filing separately. Enter spouse’s SSN above

and full name here. 

Cat. No. 11320B





Label

Form 1040 (2004)

IRS Use Only—Do not write or staple in this space.

Head of household (with qualifying person). (See page 20.) If

the qualifying person is a child but not your dependent, enter

this child’s name here. 

Other income. List type and amount (see page 27)

Moving expenses. Attach Form 3903

25

26

For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see page 77.

Boxes checked

on 6a and 6b

No. of children

on 6c who:

Dependents on 6c

not entered above

Add numbers on

lines above 

● lived with you

● did not live with

you due to divorce

or separation

(see page 21)

34a 34a

Student loan interest deduction (see page 31)

33

35

  Important!

Yes No

Note. Checking “Yes” will not change your tax or reduce your refund.

Do you, or your spouse if filing a joint return, want $3 to go to this fund? 

You must enter

your SSN(s) above.

No Yes

You Spouse

(See page 19.)

(99)

Tuition and fees deduction (see page 32)

36

4

5

Deduction for clean-fuel vehicles (see page 29) 23

b Qualified dividends (see page 23) 9b

2004

24 Certain business expenses of reservists, performing artists, and

fee-basis government officials. Attach Form 2106 or 2106-EZ 24

28 Health savings account deduction. Attach Form 8889 28
58

Proof as of

June 18, 2004

(subject to change)

Itemized deductions (from Schedule A) or your standard deduction (see left margin)

Add lines 63 through 69. These are your total payments 

Form 1040 (2004) Page 2

37 Amount from line 36 (adjusted gross income) 37

Check

if:

38a

Tax and

Credits

38a

Single or

Married filing

separately,

$4,850

If you are married filing separately and your spouse itemizes deductions, or

you were a dual-status alien, see page 34 and check here 

b

38b

39 39

40 Subtract line 39 from line 37 40

41

If line 37 is $107,025 or less, multiply $3,100 by the total number of exemptions claimed on

line 6d. If line 37 is over $107,025, see the worksheet on page 35

41

42 Taxable income. Subtract line 41 from line 40. If line 41 is more than line 40, enter -0- 42

43 43

47

48

53

Education credits. Attach Form 8863

46

51

Other credits. Check applicable box(es):

50

55

56

Add lines 46 through 54. These are your total credits

50

Subtract line 55 from line 45. If line 55 is more than line 45, enter -0- 

55

Self-employment tax. Attach Schedule SE

56

Other

Taxes

57

71

Social security and Medicare tax on tip income not reported to employer. Attach Form 4137

Additional tax on IRAs, other qualified retirement plans, etc. Attach Form 5329 if required 59

58

60

Add lines 56 through 61. This is your total tax 

61 61

63 Federal income tax withheld from Forms W-2 and 1099 63

64 2004 estimated tax payments and amount applied from 2003 return 64

Payments

65

Amount paid with request for extension to file (see page 56) 68

67

Excess social security and tier 1 RRTA tax withheld (see page 56) 66

68

70

69 Other payments from:

72a 72a

73 73

If line 70 is more than line 62, subtract line 62 from line 70. This is the amount you overpaid

74 74

Amount of line 71 you want refunded to you 

Refund

75

Amount of line 71 you want applied to your 2005 estimated tax 

Estimated tax penalty (see page 58)

Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and

belief, they are true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.

75

You were born before January 2, 1940, Blind.

Spouse was born before January 2, 1940, Blind.

a Form 3800

b Form 8801 c Specify

a Form 2439 b Form 4136

59

Household employment taxes. Attach Schedule H

60

69

Amount

You Owe

Sign

Here Your signature Date

Keep a copy

for your

records.

Spouse’s signature. If a joint return, both must sign. Date

Date Preparer’s SSN or PTIN Preparer’s

signature Check if

self-employed

Paid

Preparer’s

Use Only Firm’s name (or

yours if self-employed),

address, and ZIP code

EIN

Phone no.







Your occupation

Tax (see page 36). Check if any tax is from:

Amount you owe. Subtract line 70 from line 62. For details on how to pay, see page 57 

b

Direct deposit?

See page 56

and fill in 72b,

72c, and 72d.

Routing number

Account number

c Checking Savings

a Form(s) 8814 Form 4972

b

d





70

49

46

Retirement savings contributions credit. Attach Form 8880

57

58

Advance earned income credit payments from Form(s) W-2

71



Child tax credit (see page 40)

49 Credits from:

53

51

Additional child tax credit. Attach Form 8812

66

67

Head of

household,

$7,150

Married filing

jointly or

Qualifying

widow(er),

$9,700

Standard

Deduction

for—

Joint return?

See page 20.

Daytime phone number

( )

Earned income credit (EIC)

Credit for the elderly or the disabled. Attach Schedule R

44

45

47

Alternative minimum tax (see page 38). Attach Form 6251

Add lines 43 and 44 

Credit for child and dependent care expenses. Attach Form 2441

48

If you have a

qualifying

child, attach

Schedule EIC.

44

45

65

Spouse’s occupation

( )

Form 1040 (2004)

● People who

checked any

box on line

38a or 38b or

who can be

claimed as a

dependent,

see page 34.

● All others:

Designee’s

name 

Do you want to allow another person to discuss this return with the IRS (see page 58)? Third Party

Designee Phone

no.  ( )

Yes. Complete the following. No

Personal identification

number (PIN) 

54

Foreign tax credit. Attach Form 1116 if required

54

a Form 8396 b Form 8859

52 52

Adoption credit. Attach Form 8839

62 62

Type:

c Form 8885

Total boxes  checked 
59

Proof as of

June 18, 2004

(subject to change)

Schedules A&B (Form 1040) 2004 OMB No. 1545-0074 Page 2

Name(s) shown on Form 1040. Do not enter name and social security number if shown on other side. Your social security number

Attachment Schedule B—Interest and Ordinary Dividends Sequence No. 08

Part I

Interest

(See page B-1

and the

instructions for

Form 1040,

line 8a.)

Amount List name of payer. If any interest is from a seller-financed mortgage and the

buyer used the property as a personal residence, see page B-1 and list this

interest first. Also, show that buyer’s social security number and address 

1

Note. If you

received a Form

1099-INT, Form

1099-OID, or

substitute

statement from

a brokerage firm,

list the firm’s

name as the

payer and enter

the total interest

shown on that

form.

1

2 Add the amounts on line 1 2

3

Excludable interest on series EE and I U.S. savings bonds issued after 1989.

Attach Form 8815

3

4 Subtract line 3 from line 2. Enter the result here and on Form 1040, line 8a  4

Part II

Ordinary

Dividends

Amount

(See page B-1

and the

instructions for

Form 1040,

line 9a.)

5 List name of payer 

Note. If you

received a Form

1099-DIV or

substitute

statement from

a brokerage firm,

list the firm’s

name as the

payer and enter

the ordinary

dividends shown

on that form.

5

6 Add the amounts on line 5. Enter the total here and on Form 1040, line 9a  6

For Paperwork Reduction Act Notice, see Form 1040 instructions. Schedule B (Form 1040) 2004

Printed on recycled paper

Note. If line 4 is over $1,500, you must complete Part III.

Note. If line 6 is over $1,500, you must complete Part III.

You must complete this part if you (a) had over $1,500 of taxable interest or ordinary dividends; or (b) had

Part III a foreign account; or (c) received a distribution from, or were a grantor of, or a transferor to, a foreign trust.

Foreign

Accounts

and Trusts

Yes No

At any time during 2004, did you have an interest in or a signature or other authority over a financial

account in a foreign country, such as a bank account, securities account, or other financial account?

See page B-2 for exceptions and filing requirements for Form TD F 90-22.1

7a

b If “Yes,” enter the name of the foreign country  

(See

page B-2.) During 2004, did you receive a distribution from, or were you the grantor of, or transferor to, a

foreign trust? If “Yes,” you may have to file Form 3520. See page B-2

8
60

Proof as of

June 18, 2004

(subject to change)

Form 1040—Lines 20a and 20b

Social Security Benefits Worksheet—Lines 20a and 20b Keep for Your Records

Before you begin:  Complete Form 1040, lines 21, 23 through 25, and 28 through 34a, if they apply

to you.

 Figure any write-in adjustments to be entered on the dotted line next to line 35

(see page 33).

 If you are married filing separately and you lived apart from your spouse for all

of 2004, enter “D” to the right of the word “benefits” on line 20a.

 Be sure you have read the Exception on page 27 to see if you can use this

worksheet instead of a publication to find out if any of your benefits are taxable.

1. Enter the total amount from box 5 of all your Forms SSA-1099 and

Forms RRB-1099 .......................................... 1.

2. Enter one-half of line 1 ...................................................... 2.

3. Enter the total of 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. Add lines 2, 3, and 4 ........................................................ 5.

6. Enter the total of the amounts from Form 1040, lines 23 through 25, and 28 through 34a, plus

any write-in adjustments you entered on the dotted line next to line 35 ................... 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.

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 2004, enter

$25,000 } .............. 8.

• Married filing separately and you lived with your spouse at any time

in 2004, 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. You do not have to enter any

amounts on line 20a or 20b of Form 1040. But if you are married filing

separately and you lived apart from your spouse for all of 2004, enter -0- on line

20b. 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 2004 . . 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 ................. 18.

• Enter the amount from line 1 above on Form 1040, line 20a.

• Enter the amount from line 18 above on Form 1040, line 20b.

If part of your benefits are taxable for 2004 and they include benefits paid in 2004 that were for an earlier year,

you may be able to reduce the taxable amount. See Pub. 915 for details.

TIP

- 25 - Need more information or forms? See page 7.
61

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

C-11 How much taxable pension income will be reported on Form 1040 Line 16b?

______________

C-12 What is the amount on Form 1040, Line 8b? _____________________

C-13 How much of their combined Social Security and RRB Social Security-equivalent 

benefi ts will be taxable on form 1040, Line 20b? _____________________

63

For questions C-14 through C-20, use the following scenario to complete a Form 1040 

and appropriate forms and worksheets. Either fill-in the blank or select the most correct 

response and record your answers on the answer sheet located in the front of the retest 

booklet.

Earl and Jane Purdue arrive at your site with documents needed to prepare their tax return. 

They are retired. Earl was born on May 14, 1934 and Jane was born on January 2, 1943. They 

provide their Social Security cards and the information returns shown below. Earl and Jane 

live at 77 North 12th Street. They both would like to contribute to the Presidential Election 

Campaign.

Estimated tax payments of $160 per quarter were made on the 15th of April, June, and 

September of 2004.

Earl accumulated 577 stock shares of Wilkes Corporation (WC) prior to his retirement in 1996. 

He has records indicating that his total investment in the stock is $731.49.

CORRECTED (if checked)

PAYER’S name, street address, city, state, ZIP code, and telephone no. OMB No. 1545-0112 Payer’s RTN (optional)

Interest Income

PAYER’S Federal identification number RECIPIENT’S identification number 1 Interest income not included in box 3

$

Early withdrawal penalty Interest on U.S. Savings

Bonds and Treas. obligations

RECIPIENT’S name 2 3

$ $

Street address (including apt. no.) 4 Federal income tax withheld

$

Foreign country or U.S.

possession

City, state, and ZIP code 6 Foreign tax paid 7

Account number (optional)

$

Form 1099-INT Department of the Treasury - Internal Revenue Service

Copy B

For Recipient

This is important tax

information and is

being furnished to the

Internal Revenue

Service. If you are

required to file a return,

a negligence penalty or

other sanction may be

imposed on you if this

income is taxable and

the IRS determines that

it has not been

reported.

(keep for your records)

Form 1099-INT

5 Investment expenses

$

2004 Penn National Savings and Loan

64 S. 17th Ave

Your City, State, and Zip Code

xx-xxxxxxx xxx-xx-xxxx

Earl Purdue

77 N. 12th Street

Your City, State, and Zip Code

477.47

47.75

0.00
64

FORM SSA-1099 – SOCIAL SECURITY BENEFIT STATEMENT

2004 ● PART OF YOUR SOCIAL SECURITY BENEFITS SHOWN IN BOX 5 MAY BE TAXABLE INCOME.

● SEE THE REVERSE FOR MORE INFORMATION.

Box 1. Name Box 2. Beneficiary’s Social Security Number

Box 3. Benefits Paid in 2004 Box 4. Benefits Repaid to SSA in 2004 Box 5. Net Benefits for 2003 (Box 3 minus Box 4)

DESCRIPTION OF AMOUNT IN BOX 3 DESCRIPTION OF AMOUNT IN BOX 4

Box 7. Address

Box 8. Claim Number (Use this number if you need to contact SSA.)

Form SSA-1099-SM (1-2005) DO NOT RETURN THIS FORM TO SSA OR IRS

Box 6. Voluntary Federal Income Tax Withholding

Earl Purdue xxx-xx-xxxx

10,173.00 0.00 10,173.00

Paid by check or direct 

deposit $ 9,374.00

Medicare premiums deducted

 $ 799.00

Total $10,173.00

0.00

77 N. 12th Street

Your City, State, and Zip Code
65

Employee contributions

or insurance premiums

CORRECTED (if checked)

PAYER’S name, street address, city, state, and ZIP code 1 Gross distribution Distributions From

Pensions, Annuities,

Retirement or

Profit-Sharing

Plans, IRAs,

Insurance

Contracts, etc.

$

2a Taxable amount

$

Total

distribution

Taxable amount

not determined

2b

RECIPIENT’S identification

number

PAYER’S Federal identification

number

3 Capital gain (included

in box 2a)

4 Federal income tax

withheld

$ $

RECIPIENT’S name Net unrealized

appreciation in

employer’s securities

5 6

$ $

Distribution

code(s)

Street address (including apt. no.) 7 8 Other

%

City, state, and ZIP code

Account number (optional) 10 State tax withheld 11 State/Payer’s state no.

$

13 Local tax withheld 14 Name of locality

$

Form 1099-R Department of the Treasury - Internal Revenue Service

12

15

State distribution

Local distribution

$

Copy B

Report this

income on your

Federal tax

return. If this

form shows

Federal income

tax withheld in

box 4, attach

this copy to

your return.

This information is

being furnished to

the Internal

Revenue Service.

$

$

$

$ $

$

OMB No. 1545-0119

Your percentage of total

distribution

9a

%

Form 1099-R

9b Total employee contributions

$

IRA/

SEP/

SIMPLE

2004

Wilkes Corporation Pension Trust

123 Thirteenth St.

Your City, State, and Zip Code

17,377.00

17,377.00

xx-xxxxxxx xxx-xx-xxxx

Earl Purdue

77 N. 12th Street

633.00

Your City, State, and Zip Code

7

Employee contributions

or insurance premiums

CORRECTED (if checked)

PAYER’S name, street address, city, state, and ZIP code 1 Gross distribution Distributions From

Pensions, Annuities,

Retirement or

Profit-Sharing

Plans, IRAs,

Insurance

Contracts, etc.

$

2a Taxable amount

$

Total

distribution

Taxable amount

not determined

2b

RECIPIENT’S identification

number

PAYER’S Federal identification

number

3 Capital gain (included

in box 2a)

4 Federal income tax

withheld

$ $

RECIPIENT’S name Net unrealized

appreciation in

employer’s securities

5 6

$ $

Distribution

code(s)

Street address (including apt. no.) 7 8 Other

%

City, state, and ZIP code

Account number (optional) 10 State tax withheld 11 State/Payer’s state no.

$

13 Local tax withheld 14 Name of locality

$

Form 1099-R Department of the Treasury - Internal Revenue Service

12

15

State distribution

Local distribution

$

Copy B

Report this

income on your

Federal tax

return. If this

form shows

Federal income

tax withheld in

box 4, attach

this copy to

your return.

This information is

being furnished to

the Internal

Revenue Service.

$

$

$

$ $

$

OMB No. 1545-0119

Your percentage of total

distribution

9a

%

Form 1099-R

9b Total employee contributions

$

IRA/

SEP/

SIMPLE

2004

Doane Savings Bank

321 2nd St.

Your City, State, and Zip Code

4,177.00

4,177.00

xx-xxxxxxx xxx-xx-xxxx

Jane Purdue

77 N. 12th Street

Your City, State, and Zip Code

7 ✘
66Consolidated Statement

Payer: Employer ID# xx-xxxxxxxWharton and Taylor Financial Services800 East 43rd Street

Your City, State Zip

Account Number: C4321A

Account Holder:SSN: xxx-xx-xxxxEarl PurdueJane Purdue77 Eleventh Street.Your City, State Zip

2004 Interest Income — 1099-INT

Type Box 1: Box 2: Box 3: Box 4: Box 6: Box 7:

Interest Income Not 

Included in Box 3

Early Withdrawal 

Penalty

US Savings Bond Federal Income Tax 

Withheld

Foreign Tax Paid Foreign Country or 

US Possession

CashManagementAccountDePaul Bank CD

$1433.96

$833.97 $84.00

$144.00

2004 Dividends & Distributions — 1099-DIV

 Box 1a 

Total Ordinary 

 Dividends

 $222.50 

No other entries.

Box 1b 

Qualified 

Dividends

$222.50

Box 2a

Total Capital Gain 

Distribution

 $114.63

Box 2c

Section 1202

Gain

2004 Proceeds from Broker and Barter Exchange Transactions — 1099B

 Security 

ABC

WC 

 Quantity

215 

577

 Date Acquired

9/23/03

 N/A

Date Liquidated 

6/15/2004 

9/14/2004

Sale Price

 $6,349.00 

 $7,317.00

 Cost Basis

$6,667.00 

N/A

 Gain (Loss)

 ($318)

 N/A

Total Sales $13,666.00

2004 Non-Reportable Dividends/InterestYour City Bond 

Tax Exempt Interest Paid

$222.00
67

Proof as of

June 18, 2004

(subject to change)

Department of the Treasury—Internal Revenue Service 1040 U.S. Individual Income Tax Return

For the year Jan. 1–Dec. 31, 2004, or other tax year beginning , 2004, ending , 20 OMB No. 1545-0074

Your first name and initial Last name Your social security number

(See

instructions

on page 19.)

L

A

B

E

L

H

E

R

E

If a joint return, spouse’s first name and initial Last name Spouse’s social security number

Use the IRS

label.

Otherwise,

please print

or type.

Home address (number and street). If you have a P.O. box, see page 19. Apt. no.

City, town or post office, state, and ZIP code. If you have a foreign address, see page 19.

Presidential

Election Campaign

1 Single

Filing Status 2 Married filing jointly (even if only one had income)

Check only

one box.

3

Qualifying widow(er) with dependent child (see page 20)

6a Yourself. If someone can claim you as a dependent, do not check box 6a

Exemptions b Spouse

(4) if qualifying

child for child tax

credit (see page 21)

c Dependents: (2) Dependent’s

social security number

(3) Dependent’s

relationship to (1) First name Last name you

If more than four

dependents, see

page 21.

d Total number of exemptions claimed

7 Wages, salaries, tips, etc. Attach Form(s) W-2 7

Income 8a Taxable interest. Attach Schedule B if required 8a

b Tax-exempt interest. Do not include on line 8a 8b Attach

Forms W-2 and

W-2G here.

Also attach

Form(s) 1099-R

if tax was

withheld.

9a Ordinary dividends. Attach Schedule B if required 9a

10 Taxable refunds, credits, or offsets of state and local income taxes (see page 23) 10

11 Alimony received 11

12 Business income or (loss). Attach Schedule C or C-EZ 12

Enclose, but do

not attach, any

payment. Also,

please use

Form 1040-V.

13 Capital gain or (loss). Attach Schedule D if required. If not required, check here  13

14 Other gains or (losses). Attach Form 4797 14

15a IRA distributions 15a 15b b Taxable amount (see page 25)

16a Pensions and annuities 16a b Taxable amount (see page 25) 16b

17 Rental real estate, royalties, partnerships, S corporations, trusts, etc. Attach Schedule E 17

18 Farm income or (loss). Attach Schedule F 18

19 Unemployment compensation 19

20a Social security benefits 20a b Taxable amount (see page 27) 20b

21 21

22 Add the amounts in the far right column for lines 7 through 21. This is your total income  22

IRA deduction (see page 29) 25

23

27

26

One-half of self-employment tax. Attach Schedule SE

29

Self-employed health insurance deduction (see page 33)

27

30

29

Self-employed SEP, SIMPLE, and qualified plans

31

30

Penalty on early withdrawal of savings

32

31

Alimony paid b Recipient’s SSN 

Add lines 23 through 34a 35

32

Subtract line 35 from line 22. This is your adjusted gross income 

33

Adjusted

Gross

Income

36

If you did not

get a W-2,

see page 22. Form

Married filing separately. Enter spouse’s SSN above

and full name here. 

Cat. No. 11320B





Label

Form 1040 (2004)

IRS Use Only—Do not write or staple in this space.

Head of household (with qualifying person). (See page 20.) If

the qualifying person is a child but not your dependent, enter

this child’s name here. 

Other income. List type and amount (see page 27)

Moving expenses. Attach Form 3903

25

26

For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see page 77.

Boxes checked

on 6a and 6b

No. of children

on 6c who:

Dependents on 6c

not entered above

Add numbers on

lines above 

● lived with you

● did not live with

you due to divorce

or separation

(see page 21)

34a 34a

Student loan interest deduction (see page 31)

33

35

  Important!

Yes No

Note. Checking “Yes” will not change your tax or reduce your refund.

Do you, or your spouse if filing a joint return, want $3 to go to this fund? 

You must enter

your SSN(s) above.

No Yes

You Spouse

(See page 19.)

(99)

Tuition and fees deduction (see page 32)

36

4

5

Deduction for clean-fuel vehicles (see page 29) 23

b Qualified dividends (see page 23) 9b

2004

24 Certain business expenses of reservists, performing artists, and

fee-basis government officials. Attach Form 2106 or 2106-EZ 24

28 Health savings account deduction. Attach Form 8889 28
68

Proof as of

June 18, 2004

(subject to change)

Itemized deductions (from Schedule A) or your standard deduction (see left margin)

Add lines 63 through 69. These are your total payments 

Form 1040 (2004) Page 2

37 Amount from line 36 (adjusted gross income) 37

Check

if:

38a

Tax and

Credits

38a

Single or

Married filing

separately,

$4,850

If you are married filing separately and your spouse itemizes deductions, or

you were a dual-status alien, see page 34 and check here 

b

38b

39 39

40 Subtract line 39 from line 37 40

41

If line 37 is $107,025 or less, multiply $3,100 by the total number of exemptions claimed on

line 6d. If line 37 is over $107,025, see the worksheet on page 35

41

42 Taxable income. Subtract line 41 from line 40. If line 41 is more than line 40, enter -0- 42

43 43

47

48

53

Education credits. Attach Form 8863

46

51

Other credits. Check applicable box(es):

50

55

56

Add lines 46 through 54. These are your total credits

50

Subtract line 55 from line 45. If line 55 is more than line 45, enter -0- 

55

Self-employment tax. Attach Schedule SE

56

Other

Taxes

57

71

Social security and Medicare tax on tip income not reported to employer. Attach Form 4137

Additional tax on IRAs, other qualified retirement plans, etc. Attach Form 5329 if required 59

58

60

Add lines 56 through 61. This is your total tax 

61 61

63 Federal income tax withheld from Forms W-2 and 1099 63

64 2004 estimated tax payments and amount applied from 2003 return 64

Payments

65

Amount paid with request for extension to file (see page 56) 68

67

Excess social security and tier 1 RRTA tax withheld (see page 56) 66

68

70

69 Other payments from:

72a 72a

73 73

If line 70 is more than line 62, subtract line 62 from line 70. This is the amount you overpaid

74 74

Amount of line 71 you want refunded to you 

Refund

75

Amount of line 71 you want applied to your 2005 estimated tax 

Estimated tax penalty (see page 58)

Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and

belief, they are true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.

75

You were born before January 2, 1940, Blind.

Spouse was born before January 2, 1940, Blind.

a Form 3800

b Form 8801 c Specify

a Form 2439 b Form 4136

59

Household employment taxes. Attach Schedule H

60

69

Amount

You Owe

Sign

Here Your signature Date

Keep a copy

for your

records.

Spouse’s signature. If a joint return, both must sign. Date

Date Preparer’s SSN or PTIN Preparer’s

signature Check if

self-employed

Paid

Preparer’s

Use Only Firm’s name (or

yours if self-employed),

address, and ZIP code

EIN

Phone no.







Your occupation

Tax (see page 36). Check if any tax is from:

Amount you owe. Subtract line 70 from line 62. For details on how to pay, see page 57 

b

Direct deposit?

See page 56

and fill in 72b,

72c, and 72d.

Routing number

Account number

c Checking Savings

a Form(s) 8814 Form 4972

b

d





70

49

46

Retirement savings contributions credit. Attach Form 8880

57

58

Advance earned income credit payments from Form(s) W-2

71



Child tax credit (see page 40)

49 Credits from:

53

51

Additional child tax credit. Attach Form 8812

66

67

Head of

household,

$7,150

Married filing

jointly or

Qualifying

widow(er),

$9,700

Standard

Deduction

for—

Joint return?

See page 20.

Daytime phone number

( )

Earned income credit (EIC)

Credit for the elderly or the disabled. Attach Schedule R

44

45

47

Alternative minimum tax (see page 38). Attach Form 6251

Add lines 43 and 44 

Credit for child and dependent care expenses. Attach Form 2441

48

If you have a

qualifying

child, attach

Schedule EIC.

44

45

65

Spouse’s occupation

( )

Form 1040 (2004)

● People who

checked any

box on line

38a or 38b or

who can be

claimed as a

dependent,

see page 34.

● All others:

Designee’s

name 

Do you want to allow another person to discuss this return with the IRS (see page 58)? Third Party

Designee Phone

no.  ( )

Yes. Complete the following. No

Personal identification

number (PIN) 

54

Foreign tax credit. Attach Form 1116 if required

54

a Form 8396 b Form 8859

52 52

Adoption credit. Attach Form 8839

62 62

Type:

c Form 8885

Total boxes  checked 
69

Proof as of

June 18, 2004

(subject to change)

Schedules A&B (Form 1040) 2004 OMB No. 1545-0074 Page 2

Name(s) shown on Form 1040. Do not enter name and social security number if shown on other side. Your social security number

Attachment Schedule B—Interest and Ordinary Dividends Sequence No. 08

Part I

Interest

(See page B-1

and the

instructions for

Form 1040,

line 8a.)

Amount List name of payer. If any interest is from a seller-financed mortgage and the

buyer used the property as a personal residence, see page B-1 and list this

interest first. Also, show that buyer’s social security number and address 

1

Note. If you

received a Form

1099-INT, Form

1099-OID, or

substitute

statement from

a brokerage firm,

list the firm’s

name as the

payer and enter

the total interest

shown on that

form.

1

2 Add the amounts on line 1 2

3

Excludable interest on series EE and I U.S. savings bonds issued after 1989.

Attach Form 8815

3

4 Subtract line 3 from line 2. Enter the result here and on Form 1040, line 8a  4

Part II

Ordinary

Dividends

Amount

(See page B-1

and the

instructions for

Form 1040,

line 9a.)

5 List name of payer 

Note. If you

received a Form

1099-DIV or

substitute

statement from

a brokerage firm,

list the firm’s

name as the

payer and enter

the ordinary

dividends shown

on that form.

5

6 Add the amounts on line 5. Enter the total here and on Form 1040, line 9a  6

For Paperwork Reduction Act Notice, see Form 1040 instructions. Schedule B (Form 1040) 2004

Printed on recycled paper

Note. If line 4 is over $1,500, you must complete Part III.

Note. If line 6 is over $1,500, you must complete Part III.

You must complete this part if you (a) had over $1,500 of taxable interest or ordinary dividends; or (b) had

Part III a foreign account; or (c) received a distribution from, or were a grantor of, or a transferor to, a foreign trust.

Foreign

Accounts

and Trusts

Yes No

At any time during 2004, did you have an interest in or a signature or other authority over a financial

account in a foreign country, such as a bank account, securities account, or other financial account?

See page B-2 for exceptions and filing requirements for Form TD F 90-22.1

7a

b If “Yes,” enter the name of the foreign country  

(See

page B-2.) During 2004, did you receive a distribution from, or were you the grantor of, or transferor to, a

foreign trust? If “Yes,” you may have to file Form 3520. See page B-2

8

71

Proof as of

June 18, 2004

(subject to change)

OMB No. 1545-0074 SCHEDULE D Capital Gains and Losses (Form 1040)  Attach to Form 1040.  See Instructions for Schedule D (Form 1040).

Department of the Treasury

Internal Revenue Service

Attachment

 Use Schedule D-1 to list additional transactions for lines 1 and 8. Sequence No. 12

Name(s) shown on Form 1040 Your social security number

Short-Term Capital Gains and Losses—Assets Held One Year or Less

(f) Gain or (loss)

Subtract (e) from (d)

(e) Cost or other basis

(see page D-6 of

the instructions)

(a) Description of property

(Example: 100 sh. XYZ Co.)

(d) Sales price

(see page D-6 of

the instructions)

(c) Date sold

(Mo., day, yr.)

1

Enter your short-term totals, if any, from Schedule D-1,

line 2

2

Total short-term sales price amounts. Add lines 1 and 2 in

column (d)

3

3

5

Short-term gain from Form 6252 and short-term gain or (loss) from Forms 4684, 6781, and 8824

5

6

6

Net short-term gain or (loss) from partnerships, S corporations, estates, and trusts from

Schedule(s) K-1

7

Short-term capital loss carryover. Enter the amount, if any, from line 8 of your Capital Loss

Carryover Worksheet on page D-5 of the Instructions

Net short-term capital gain or (loss). Combine lines 1 through 6 in column (f)

Long-Term Capital Gains and Losses—Assets Held More Than One Year

8

Enter your long-term totals, if any, from Schedule D-1,

line 9

9

10 Total long-term sales price amounts. Add lines 8 and 9 in

column (d) 10

11

Gain from Form 4797, Part I; long-term gain from Forms 2439 and 6252; and long-term gain or

(loss) from Forms 4684, 6781, and 8824

11

12

12

13

Net long-term gain or (loss) from partnerships, S corporations, estates, and trusts from

Schedule(s) K-1

14

Capital gain distributions. See page D-2 of the instructions

14

15

Long-term capital loss carryover. Enter the amount, if any, from line 13 of your Capital Loss

Carryover Worksheet on page D-5 of the Instructions ( )

Net long-term capital gain or (loss). Combine lines 8 through 14 in column (f). Then go to

Part III on the back 15

For Paperwork Reduction Act Notice, see Form 1040 instructions. Schedule D (Form 1040) 2004 Cat. No. 11338H

( )

4 4

Part I

Part II

13

(b) Date

acquired

(Mo., day, yr.)

2

9

(99)

(a) Description of property

(Example: 100 sh. XYZ Co.)

(c) Date sold

(Mo., day, yr.)

(b) Date

acquired

(Mo., day, yr.)

(e) Cost or other basis

(see page D-6 of

the instructions)

(d) Sales price

(see page D-6 of

the instructions)

2004

7

(f) Gain or (loss)

Subtract (e) from (d)
72

Proof as of

June 18, 2004

(subject to change)

Schedule D (Form 1040) 2004

Printed on recycled paper

Summary

Combine lines 7 and 15 and enter the result. If line 16 is a loss, skip lines 17 through 20, and

go to line 21. If a gain, enter the gain on Form 1040, line 13

16

16

18

Part III

Page 2

18 Enter the amount, if any, from line 7 of the 28% Rate Gain Worksheet on page D-7 of the

instructions 

Are lines 18 and 19 both zero or blank?

19

Schedule D (Form 1040) 2004

21

Enter the amount, if any, from line 18 of the Unrecaptured Section 1250 Gain Worksheet on

page D-8 of the instructions 

20

21 If line 16 is a loss, enter here and on Form 1040, line 13, the smaller of:

19

● The loss on line 16 or

● ($3,000), or if married filing separately, ($1,500) 

Yes. Complete Form 1040 through line 42, and then complete the Qualified Dividends and

Capital Gain Tax Worksheet on page 37 of the Instructions for Form 1040. Do not complete

lines 21 and 22 below.

No. Complete the Schedule D Tax Worksheet on page D-10 of the instructions. Do not

complete lines 21 and 22 below.

22 Do you have qualified dividends on Form 1040, line 9b?

Yes. Complete Form 1040 through line 42, and then complete the Qualified Dividends and

Capital Gain Tax Worksheet on page 37 of the Instructions for Form 1040.

No. Complete the rest of Form 1040.

( )

17 Are lines 15 and 16 both gains?

Yes. Go to line 18.

No. Skip lines 18 through 21, and go to line 22.

Note. When figuring which amount is smaller, treat both amounts as positive numbers.
73

Proof as of

June 18, 2004

(subject to change)

Form 1040—Lines 20a and 20b

Social Security Benefits Worksheet—Lines 20a and 20b Keep for Your Records

Before you begin:  Complete Form 1040, lines 21, 23 through 25, and 28 through 34a, if they apply

to you.

 Figure any write-in adjustments to be entered on the dotted line next to line 35

(see page 33).

 If you are married filing separately and you lived apart from your spouse for all

of 2004, enter “D” to the right of the word “benefits” on line 20a.

 Be sure you have read the Exception on page 27 to see if you can use this

worksheet instead of a publication to find out if any of your benefits are taxable.

1. Enter the total amount from box 5 of all your Forms SSA-1099 and

Forms RRB-1099 .......................................... 1.

2. Enter one-half of line 1 ...................................................... 2.

3. Enter the total of 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. Add lines 2, 3, and 4 ........................................................ 5.

6. Enter the total of the amounts from Form 1040, lines 23 through 25, and 28 through 34a, plus

any write-in adjustments you entered on the dotted line next to line 35 ................... 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.

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 2004, enter

$25,000 } .............. 8.

• Married filing separately and you lived with your spouse at any time

in 2004, 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. You do not have to enter any

amounts on line 20a or 20b of Form 1040. But if you are married filing

separately and you lived apart from your spouse for all of 2004, enter -0- on line

20b. 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 2004 . . 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 ................. 18.

• Enter the amount from line 1 above on Form 1040, line 20a.

• Enter the amount from line 18 above on Form 1040, line 20b.

If part of your benefits are taxable for 2004 and they include benefits paid in 2004 that were for an earlier year,

you may be able to reduce the taxable amount. See Pub. 915 for details.

TIP

- 25 - Need more information or forms? See page 7.
74

Proof as of

June 18, 2004

(subject to change)

Form 1040—Line 43

Qualified Dividends and Capital Gain Tax Worksheet—Line 43 Keep for Your Records

Before you begin:  See the instructions for line 43 on page 36 to see if you can use this worksheet to

figure your tax.

 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.

1. Enter the amount from Form 1040, line 42 .................................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, but

do not enter less than -0- } . . 3.

No. Enter the amount from Form 1040, line 13

4. Add lines 2 and 3 ....................................... 4.

5. If you are claiming investment interest expense on Form 4952, enter

the 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 the smaller of:

• The amount on line 1 or

• $29,050 if single or married filing separately, } .........8.

$58,100 if married filing jointly or qualifying widow(er), or

$38,900 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 through 11; go to line 12 and check the ‘‘No’’ box.

No. Enter the amount from line 7 ....................................9.

10. Subtract line 9 from line 8 .............................................10.

11. Multiply line 10 by 5% (.05) .......................................................11.

12. Are the amounts on lines 6 and 10 the same?

Yes. Skip lines 12 through 15; go to line 16.

No. Enter the smaller of line 1 or line 6 ...............................12.

13. Enter the amount from line 10 (if line 10 is blank, enter -0-) ....................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 Tax Table or Tax Computation Worksheet, whichever

applies .......................................................................16.

17. Add lines 11, 15, and 16 ..........................................................17.

18. Figure the tax on the amount on line 1. Use the Tax Table or Tax Computation Worksheet, whichever

applies .......................................................................18.

19. Tax on all taxable income. Enter the smaller of line 17 or line 18. Also include this amount on Form

1040, line 43 ...................................................................19.

Need more information or forms? See page 7. - 34 -
75

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

C-14 What is the amount shown on Form 1040, Line 8a?

a. $1,911

b. $2,745

c. $2,967

d. $2,968

e. None of the above

C-15 What is the amount shown on Schedule D, Line 15?

a. $6,268

b. $6,586

c. $6,701

d. $6,383

e. None of the above

C-16 What is the amount shown on Form 1040, Line 33?

a. $48

b. $633

c. $681

d. $222

e. None of the above

C-17 What is the amount shown on form 1040, Line 20a?

a. $10,173

b. $0

c. $9,374

d. $17,377

e. None of the above

C-18 What is the amount shown on Form 1040, Line 70?

a. $0

b. $1,008

c. $1,501

d. $1,341

e. None of the above

C-19 What is the amount shown on Form 1040, Line 8b? __________________

C-20 What is the amount shown on Form 1040, Line 9b? __________________

77

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

PART D — Military Returns

For questions D-1 through D-28 determine whether each of the following statements is 

true or false and record your answers on the answer sheet located in the front of the 

test booklet.

a. True

b. False

D-1 Required insignia such as rank, epaulets, and decorations are deductible.

D-2 Private Kent can deduct moving costs associated with a permanent change of station.

D-3 If a member of the Armed Forces serves in a combat zone from March 1 to 

November 1, all nine months combat zone pay will be excluded.

D-4 In order to be deductible, travel expenses must exceed any advance, allowance, or 

reimbursements.

D-5 Contributions to a Thrift Savings Plan from pay earned while serving in a combat zone 

reduces taxable income.

D-6 Corporal James Greene married an Italian citizen. In 2004, their son was born in Italy. 

His son meets the citizen/resident test.

D-7 Airman Smith can fi le Schedule C-EZ to report his business income of $40,000 and 

business expenses of $5,050.

D-8 SSGT Martin rents out his former home. He should report the income and expenses on 

Schedule E.

D-9 Active duty personnel serving outside of the United States and Puerto Rico are granted 

an automatic two-month extension.

D-10 If travel and transportation costs are fully covered by the military, you need to report the 

transactions on the tax return.

D-11 All extensions to fi le (except combat zone) are subject to interest charges on taxes due.

D-12 Military personnel with spouses who are non-resident aliens may be considered 

unmarried for purposes of using the fi ling status Head of Household.

D-13 Private Thomas has net income of $450 on his Schedule C-EZ. He needs to fi le 

Schedule SE to calculate self-employment tax.

D-14 Eligibility for the Retirement Savings Contributions Credit is determined by fi ling status 

and gross income.
78

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

D-15 Sgt. Jerry Black authorized a dependency allotment of $150 per month for his mother. 

Mrs. Black’s total support from all sources is $550 per month. Because all the other 

dependency tests are met and Sgt. Black has set up an allotment to his mother, he can 

claim her as a dependent on his return.

D-16 If illness occurs due to service in a combat zone, the income exclusion continues during 

the time spent in a hospital outside the combat zone.

D-17 If a Form 1099MISC is not received, income received must still be claimed on the 

return.

D-18 A Schedule E only has to be fi led if the house is rented out for more than half of the 

year.

D-19 If a service person becomes a prisoner of war, the combat zone exclusion continues.

D-20 Active duty personnel should send their returns to the service center for where they 

currently reside rather than their permanent home.

D-21 If excess travel funds are reimbursed to the government, those funds are reported as 

income.

D-22 The fi ling date for active duty personnel in the United States and Puerto Rico is April 15.

D-23 The 180-day rule starts the last day in a combat zone or in a hospital.

D-24 Lori is in the Reserves and she attends training and drills every month that require her 

to incur travel costs. Lori can deduct the unreimbursed expenses on her tax return.

D-25 Captain Bennett cannot claim his mother, who is a citizen and resident of Spain, on his 

tax return.

D-26 The third-party designee authorization cannot be revoked.

D-27 Military pay attributable to active service in a combat zone that is excluded from gross 

income will appear on a serviceperson’s Form W-2 in the box marked “Wages, tips, 

other compensation.”

D-28 In order to be deductible, travel expenses must exceed any advance, allowance, or 

reimbursement.
79

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

For questions D-29 through D-40, select the most correct response and record your 

answers on the answer sheet located in the front of the test booklet.

D-29 Deduction for meals, if fully reimbursed, is limited to what percent?

a. 0

b. 10%

c. 75%

d. 100%

e. None of the above

D-30 Which of the following is a permanent change of station?

a. A move from the last post of duty to the home of record

b. A move from Maxwell AFB to Andersen AFB for a six-month detail

c. Both

d. Neither

D-31 Which of the following excess expenses are not deductible?

a. Packing of household goods

b. Renting a trailer to transport household goods

c. Meals en-route from one permanent change of station to another

d. Automobile expenses from one permanent change of station to another

e. None of the above

D-32 What item is not a qualifying item in a combat zone?

a. Active Duty pay

b. Student loan repayments

c. Retirement pay

d. Awards for suggestions

e. None of the above

D-33 Is a re-enlistment bonus included as taxable income?

a. Yes, it is supplemental income

b. No, it is not earned income

c. Yes, unless occurring while in a combat zone

d. No, it is specifi cally exempt

e. None of the above
80

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

D-34 What agency makes the determination whether a medical disability is approved?

a. Department of Defense

b. Internal Revenue Service

c. Veterans’ Administration

d. Social Security Administration

e. Department of Health and Human Services

D-35 The maximum amount contributed to all Thrift Savings Plans of a uniformed service 

member includes:

a. 8% of basic pay per period

b. Part or all of incentive, special pay or bonus amounts

c. If over age 50, a catch up amount of $2,000 in 2004

d. All of the above

e. None of the above

D-36 To claim a personal exemption for a spouse that is a non-resident alien, the following 

must be true:

a. The spouse must be treated as a resident alien

b. A joint return must be fi led the fi rst year

c. The spouse’s world-wide income must be reported

d. All the above

e. None of the above

D-37 What tax year is used when claiming business income for a cash basis taxpayer?

a. The year in which the income is used

b. The year when the income was received

c. Whatever tax year is most benefi cial to the taxpayer

d. The year in which the business declares a profi t

e. None of the above
8

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

Record all answers on the tear-out Test Answer Sheet located in the front of the 

test booklet

D-38 Seaman Robert Blue and his wife moved from Naval Station, San Diego to Naval 

Station, Norfolk. He received a dislocation allowance of $1,400, mileage allowance of 

$500, and per diem allowance of $300. The allowances were not reported on his W-2. 

His expenses included: dislocation ($1,500), travel ($350), and meals ($500). Seaman 

Blue’s moving expense deduction is:

a. $1,500

b. $1,400

c. $500

d. $350

e. 0

D-39 In which of the following situations must allowances and reimbursements be included in 

income?

a. Payment for a do-it-yourself (DITY) permanent change station (PCS) move

b. Allowances for dislocation, temporary lodging, and per diem

c. Unreturned reimbursements/allowances (other than non-tax allowances) in excess o

deductible moving expenses

d. All of the above

e. None of the above

D-40 Deadline extensions for combat zone are arrived at:

a. There is no extension

b. 30 days after return

c. 180 days after return

d. 180 days plus any time remaining from the fi ling season

e. None of the above

TaxWise® is a copyrighted software program owned by Universal Tax Systems, Inc.® (UTS).

All screen shots that appear throughout the official Volunteer Income Tax Assistance (VITA)

and Tax Counseling for the Elderly (TCE) training materials are used with the permission of

UTS. The screen shots used in this publication—or any other screen shots from TaxWise or

its affiliated programs—may not be extracted, copied, or distributed without written approval

from the IRS SPEC Office of Education and Product Development.

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All tax information you receive from taxpayers in your VOLUNTEER capacity is strictly confidential and should not, under any circumstances, be disclosed to unauthorized individuals.

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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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