© FTI Publishing, LLC 2013 - 2017. All Rights Reserved.    Terms of Use / Disclaimer

Home    About   Contact Us  Privacy Policy

Home About Table of Contents Forms & Instructions News

Individual Income Tax Guide





Terms of Use / Disclaimer

2016 Quick Reference Tables

Quick Reference Tables

Tax Calendar

Search Tips

Page 3: Form 1040, line 29 (cont.) to line 32

Medicare premiums: Medicare premiums you voluntarily pay to obtain insurance that is similar to qualifying private health insurance can be used to figure the deduction. Amounts paid for health insurance coverage from retirement plan distributions that were nontaxable because you are a retired public safety officer cannot be used to figure the deduction.

Worksheet for calculating deduction amount: If you qualify to take the deduction, use the Self-Employed Health Insurance Deduction Worksheet to figure the amount you can deduct.  However instead of the Self-Employed Health Insurance Deduction Worksheet, see the instructions in Publication 535 to figure your deduction if any of the following applies.

Line 30 – Penalty on Early Withdrawal of Savings: The amount of a penalty for early withdrawal of savings are reported to you on Form 1099-INT, Interest Income in box 2 or Form 1099-OID, Original Issue Discount, in box 3.

Line 31 – Alimony Paid: This line is comprised of two entry fields, 31a and 31b. The amount of any deductible alimony you paid to or for your spouse or former spouse during the year is entered in 31a. The social security number of the person you paid the alimony to is entered in 31b.

Whether payments to a spouse or former spouse qualify as deductible alimony is determined under specific rules. See the Alimony page for more information.

Line 32 – IRA Deduction: If you made contributions to a traditional IRA for 2016, you may be able to take an IRA deduction. But you, or your spouse if filing a joint return, must have had earned income to do so and if you or your spouse was covered by a retirement plan, your deduction may be reduced or eliminated. For IRA purposes, earned income includes:

If you are self-employed, earned income is generally your net earnings from self-employment if your personal services were a material income-producing factor.

A statement should be sent to you by May 31, 2017, that shows all contributions to your traditional IRA for 2016.

Taxpayers covered by a retirement plan: If you were covered by a retirement plan (qualified pension, profit-sharing (including 401(k)), annuity, SEP, SIMPLE, etc.) at work or through self-employment, your IRA deduction may be reduced or eliminated. But you can still make contributions to an IRA even if you cannot deduct them. In any case, the income earned on your IRA contributions is not taxed until it is paid to you.

The “Retirement plan” box in box 13 of your Form W-2 should be checked if you were covered by a plan at work even if you were not vested in the plan. You are also covered by a plan if you were self-employed and had a SEP, SIMPLE, or qualified retirement plan. If you were covered by a retirement plan and you file Form 2555, Foreign Earned Income, Form 2555-EZ, Foreign Earned Income Exclusion, or Form 8815, Exclusion of Interest From Series EE and I U.S. Savings Bonds Issued After 1989 (For Filers With Qualified Higher Education Expenses), or you exclude employer-provided adoption benefits, see here to figure the amount, if any, of your IRA deduction.

Married persons filing separately: If you were not covered by a retirement plan but your spouse was, you are considered covered by a plan unless you lived apart from your spouse for all of 2016. You may be able to take the retirement savings contributions credit. See the line 51 instructions.

Line 32 instructions continued on page 4.

Chapter 3 – Adjusted Gross Income