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Individual Income Tax Guide





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Line 48 – Foreign Tax Credit: If you paid income tax to a foreign country, you may be able to take this credit. Generally, you must complete and attach Form 1116, Foreign Tax Credit. (Individual, Estate, or Trust), to do so.

Exception: You do not have to complete Form 1116 to take this credit if all of the following apply.

1) All of your foreign source gross income was from interest and dividends and all of that income and the foreign tax paid on it were reported to you on Form 1099-INT, Interest Income, Form 1099-DIV, Dividends and Distributions, or Schedule K-1 (or substitute statement).

2) The total of your foreign taxes was not more than $300 ($600 if married filing jointly).

3) You held the stock or bonds on which the dividends or interest were paid for at least 16 days and were not obligated to pay these amounts to someone else.

4) You are not filing Form 4563, Exclusion of Income for Bona Fide Residents of American Samoa or excluding income from sources within Puerto Rico.

5) All of your foreign taxes were:

a) Legally owed and not eligible for a refund or reduced tax rate under a tax treaty, and

b) Paid to countries that are recognized by the United States and do not support terrorism.

For more details on these requirements, see the Instructions for Form 1116, Foreign Tax Credits.

Do you meet all five requirements above? If you do meet all five requirements, enter on line 48 the smaller of (a) your total foreign taxes, or (b) the amount on Form 1040, lines 44 and 46. If you do not, see Form 1116, Foreign Tax Credit, to find out if you can take the credit and, if you can, if you have to file Form 1116.

Line 49 – Credit for Child and Dependent Care Expenses: You may be able to take this credit if you paid someone to care for:

For details, go to the Child and Dependent Care Credit page.

Line 50 – Education Credits: If you (or your dependent) paid qualified education expenses during the year for yourself, your spouse, or your dependent to enroll in or attend an eligible educational institution, you may be able to take the American Opportunity credit or the Lifetime Learning credit See Form 8863, Education Credits, for details. However, you cannot take an education credit if any of the following applies.

You may be able to increase an education credit if the student chooses to include all or part of a Pell grant or certain other scholarships or fellowships in income.

Line 51 – Retirement Savings Contributions Credit (Saver's Credit): You may be able to take this credit if you, or your spouse if filing jointly, made:

However, you cannot take the credit if either of the following applies:

Definition of Student: You were a student if during any part of 5 calendar months of the year you:

A school includes a technical, trade, or mechanical school. It does not include an on-the-job training course, correspondence school, or school offering courses only through the Internet.

Line 52 – Child Tax Credit: You may be able to take a credit of up to $1,000 for each of your qualifying dependent children. For more information about the credit and how to calculate the amount of the credit, go to the Child Tax Credit page.

Page 3: Form 1040, line 48 To line 51

Chapter 4 – Taxes and Credits