Page 38

Form 1040—Line 44 Form 8615. Form 8615 generally must be born on January 1, 1986, is considered to be • You are filing Schedule D and Sched- used to figure the tax for any child who had age 24 at the end of 2009. ule D, lines 15 and 16, are both more than more than $1,900 of investment income, zero. Schedule D Tax Worksheet. If you have to such as taxable interest, ordinary divi- file Schedule D and Schedule D, line 18 or dends, or capital gains (including capital But if you are filing Form 2555 or 19, is more than zero, use the Schedule D gain distributions) and who either: 2555-EZ, you must use the Foreign Earned Tax Worksheet on page D-10 of the In- 1. Was under age 18 at the end of 2009, Income Tax Worksheet below instead. structions for Schedule D to figure the 2. Was age 18 at the end of 2009 and did amount to enter on Form 1040, line 44. But not have earned income that was more than if you are filing Form 2555 or 2555-EZ, Schedule J. If you had income from farm- half of the child’s support, or you must use the Foreign Earned Income ing or fishing (including certain amounts Tax Worksheet below instead. 3. Was a full-time student over age 18 received in connection with the Exxon and under age 24 at the end of 2009 and did Valdez litigation), your tax may be less if Qualified Dividends and Capital Gain Tax not have earned income that was more than you choose to figure it using income aver- Worksheet. If you do not have to use the half of the child’s support. aging on Schedule J. Schedule D Tax Worksheet (see above), use the worksheet on page 39 to figure the But if the child files a joint return for amount to enter on Form 1040, line 44, if 2009 or if neither of the child’s parents was Foreign Earned Income Tax Worksheet. any of the following applies. alive at the end of 2009, do not use Form If you claimed the foreign earned income 8615 to figure the child’s tax. • You reported qualified dividends on exclusion, housing exclusion, or housing Form 1040, line 9b. A child born on January 1, 1992, is con- deduction on Form 2555 or 2555-EZ, you sidered to be age 18 at the end of 2009; a • You do not have to file Schedule D must figure your tax using the worksheet child born on January 1, 1991, is consid- and you reported capital gain distributions below. ered to be age 19 at the end of 2009; a child on Form 1040, line 13. Foreign Earned Income Tax Worksheet—Line 44 Keep for Your Records CAUTION ! If Form 1040, line 43, is zero, do not complete this worksheet. 1. Enter the amount from Form 1040, line 43 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1. 2. Enter the amount from your (and your spouse’s, if filing jointly) Form 2555, lines 45 and 50, or Form 2555-EZ, line 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2. 3. Add lines 1 and 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3. 4. Tax on the amount on line 3. Use the Tax Table, Tax Computation Worksheet, Qualified Dividends and Capital Gain Tax Worksheet*, Schedule D Tax Worksheet*, or Form 8615, whichever applies. See the instructions for line 44 that begin on page 37 to see which tax computation method applies. (Do not use a second Foreign Earned Income Tax Worksheet to figure the tax on this line) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. 5. Tax on the amount on line 2. Use the Tax Table or Tax Computation Worksheet, whichever applies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. 6. Subtract line 5 from line 4. Enter the result. If zero or less, enter -0-. Also include this amount on Form 1040, line 44 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6. *Enter the amount from line 3 above on line 1 of the Qualified Dividends and Capital Gain Tax Worksheet or Schedule D Tax Worksheet if you use either of those worksheets to figure the tax on line 4 above. Complete the rest of that worksheet through line 6 (line 10 if you use the Schedule D Tax Worksheet). Next, you must determine if you have a capital gain excess. To find out if you have a capital gain excess, subtract Form 1040, line 43, from line 6 of your Qualified Dividends and Capital Gain Tax Worksheet (line 10 of your Schedule D Tax Worksheet). If the result is more than zero, that amount is your capital gain excess. If you do not have a capital gain excess, complete the rest of either of those worksheets according to the worksheet’s instructions. Then complete lines 5 and 6 above. If you have a capital gain excess, complete a second Qualified Dividends and Capital Gain Tax Worksheet or Schedule D Tax Worksheet (whichever applies) as instructed above but in its entirety and with the following additional modifications. Then complete lines 5 and 6 above. These modifications are to be made only for purposes of filling out the Foreign Earned Income Tax Worksheet above. 1. Reduce (but not below zero) the amount you would otherwise enter on line 3 of your Qualified Dividends and Capital Gain Tax Worksheet or line 9 of your Schedule D Tax Worksheet by your capital gain excess. 2. Reduce (but not below zero) the amount you would otherwise enter on line 2 of your Qualified Dividends and Capital Gain Tax Worksheet or line 6 of your Schedule D Tax Worksheet by any of your capital gain excess not used in (1) above. 3. Reduce (but not below zero) the amount on your Schedule D (Form 1040), line 18, by your capital gain excess. 4. Include your capital gain excess as a loss on line 16 of your Unrecaptured Section 1250 Gain Worksheet on page D-9 of the Instructions for Schedule D (Form 1040). Need more information or forms? See page 96. - 38 -