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Individual Income Tax Guide

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Line 13 – Capital Gain or Loss: Your total capital gains or losses are reported on this line. To determine the amount to report on line 13, you generally must complete and attach Form 8949, Sale and Other Dispositions of Capital Assets, and Schedule D, Capital Gains and Losses. However, there are two exceptions to this rule:

Exception 1. You do not have to file Form 8949 or Schedule D if both of the following apply.

Exception 2. You must file Schedule D, but generally do not have to file Form 8949, if Exception 1 does not apply and your only capital gains and losses are:

If Exception 1 applies, enter your total capital gain distributions (from box 2a of Form(s) 1099-DIV) on line 13 and check the box on that line. If you received capital gain distributions as a nominee (that is, they were paid to you but actually belong to someone else), report on line 13 only the amount that belongs to you. Include a statement showing the total amount you received and the amount you received as a nominee. See the instructions to Schedule B, Interest Income and Ordinary Dividends, for filing requirements for Form 1099-DIV and Form 1096, Annual Summary and Transmittal of U.S. Information Returns.

NOTE: If you do not have to file Schedule D, use the Qualified Dividends and Capital Gain Tax Worksheet to figure your tax.

Line 14 – Other Gains or Losses: Ordinary income from the sale of business assets is reported on this line. You calculate the amount reported on line 14 in Part II, Ordinary Gains and Losses, of Form 4797, Sales of Business Property. See the instructions to Form 4797 for more information about the reporting of the sales of business assets.

Line 15a & 15b – IRA Distributions (15a), Taxable Amount (15b): Distributions from IRAs (including, in general, traditional IRAs, Roth IRAs (including myRAs), Simplified Employee Pensions IRAs (SEPs or SEP IRAs), and Savings Incentive Match Plan for Employees IRAs (SIMPLE IRAs)) are included on line 15a and the taxable amounts of these distributions are included on line 15(b).

Distributions from IRAs should be reported to you on Form 1099-R. The form should show the total amount of the distribution from the IRA before income tax or other deductions were withheld.

If you have only one IRA distribution, and the entire amount is taxable, leave line 15a blank and enter the total distribution (from Form 1099-R, box 1) on line 15b. However if one of the exceptions described below, or you had more than one IRA distribution, enter your total amount of distribution(s) on line 15a and the taxable amount of your distribution(s) on line 15b.

Exception 1: Enter the total distribution on line 15a if you rolled over part or all of the distribution from one•

Also, enter ”Rollover” next to line 15b. If the total distribution was rolled over in a qualified rollover, enter -0- on line 15b. If the total distribution was not rolled over in a qualified rollover, enter the part not rolled over on line 15b unless Exception 2 applies to the part not rolled over. Generally, a qualified rollover must be made within 60 days after the day you received the distribution. For more details on rollovers, see Publication 590-A, Contributions to Individual Retirement Arrangements, and Publication 590-B, Distributions from Individual Retirement Arrangements.

If you rolled over the distribution into a qualified plan other than an IRA or you made the rollover in 2017, include a statement explaining what you did.

Exception 2: If any of the following apply, enter the total distribution on line 15a and see Form 8606, Nondeductible IRAs, and its instructions to figure the amount to enter on line 15b.

Exception 3:  If the distribution is a qualified charitable distribution (QCD), enter the total distribution on line 15a. If the total amount distributed is a QCD, enter -0- on line 15b. If only part of the distribution is a QCD, enter the part that is not a QCD on line 15b unless Exception 2 applies to that part. Enter “QCD” next to line 15b.

A QCD is a distribution made directly by the trustee of your IRA (other than an ongoing SEP or SIMPLE IRA) to an organization eligible to receive tax-deductible contributions (with certain exceptions). You must have been at least 70 and 1/2 years old when the distribution was made. Generally, your total QCDs for the year can't be more than $100,000. (On a joint return, your spouse can also have a QCD of up to $100,000.) The amount of the QCD is limited to the amount that would otherwise be included in your income. If your IRA includes nondeductible contributions, the distribution is first considered to be paid out of otherwise taxable income. See Publication 590-A for details.

Exception 4: If the distribution is a health savings account (HSA) funding distribution (HFD), enter the total distribution on line 15a. If the total amount distributed is an HFD and you elect to exclude it from income, enter -0- on line 15b. If only part of the distribution is an HFD and you elect to exclude that part from income, enter the part that is not an HFD on line 15b unless Exception 2, described above, applies to that part. Enter “HFD” next to line 15b. 

An HFD is a distribution made directly by the trustee of your IRA (other than an ongoing SEP or SIMPLE IRA) to your HSA. If eligible, you generally can elect to exclude an HFD from your income once in your lifetime. You cannot exclude more than the limit on HSA contributions or more than the amount that would otherwise be included in your income. If your IRA includes nondeductible contributions, the HFD is first considered to be paid out of otherwise taxable income. See Publication 969, Health Savings Accounts and Other Tax-Favored Health Plans, for details. 

More than one exception applies: If more than one exception applies, include a statement showing the amount of each exception, instead of making an entry next to line 15b. For example: “Line 15b – $1,000 Rollover and $500 HFD.” But you do not need to attach a statement if only Exception 2 and one other exception apply. 

More than one distribution. If you (or your spouse if you file married filing jointly) received more than one distribution, determine the taxable amount of each distribution and enter the total of the taxable amounts on line 15b. Enter the total amount of those distributions on line 15a.

CAUTION: You may have to pay an additional tax if (a) you received an early distribution from your IRA and the total was not rolled over, or (b) you were born before July 1, 1945, and received less than the minimum required distribution from your traditional, SEP, and SIMPLE IRAs. See the instructions for line 59 (Additional tax on IRAs, other qualified retirement plans, etc), for details. 

Page 4: Form 1040, line 13 to line 15

Chapter 2 – Income