Free 2008 Instruction 1040 Schedule A & B - Federal


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Preview 2008 Instruction 1040 Schedule A & B
Department of the Treasury Internal Revenue Service

2008 Instructions for Schedules A & B (Form 1040) Instructions for Schedule A, Itemized Deductions
Section references are to the Internal Revenue Code unless otherwise noted.

Use Schedule A (Form 1040) to figure your itemized deductions. In most cases, your federal income tax will be less if you take the larger of your itemized deductions or your standard deduction. If you itemize, you can deduct a part of your medical and dental expenses and unreimbursed employee business expenses, and amounts you paid for certain taxes, interest, contributions, and miscellaneous expenses. You can also deduct certain casualty and theft losses. If you and your spouse paid expenses jointly and are filing separate returns for 2008, see Pub. 504 to figure the portion of joint expenses that you can claim as itemized deductions.

Do not include on Schedule A items deducted elsewhere, such as on Form 1040 or Schedule C, C-EZ, E, or F.

Medical and Dental Expenses
You can deduct only the part of your medical and dental expenses that exceeds 7.5% of the amount on Form 1040, line 38. Pub. 502 discusses the types of expenses that you can and cannot deduct. It also explains when you can deduct capital expenses and special care expenses for disabled persons.

What's New
Qualified contributions. Certain cash con-

tion pension recipient, you must reduce your insurance premiums by any amounts used to figure the health coverage tax credit. See the instructions for line 1 on page A-2.

tributions you made for relief efforts in a Midwestern disaster area are not subject to the overall limitation on itemized deductions or the 50% adjusted gross income limitation. See Pub. 526 for more details.
Standard mileage rates. The 2008 rate for

use of your vehicle to get medical care is 19 cents a mile (27 cents a mile after June 30, 2008). The 2008 rate for charitable use of your vehicle to provide relief related to a Midwestern disaster area is 36 cents a mile (41 cents a mile after June 30, 2008).
State and local general sales taxes. The op-

If you received a distribution from a health savings account or a medical savings account in 2008, see Pub. 969 to figure your deduction.

tion to deduct state and local general sales taxes instead of state and local income taxes was extended through 2009. See the instructions for line 5 that begin on page A-2.
Qualified mortgage insurance premiums.

Examples of Medical and Dental Payments You Can Deduct
To the extent you were not reimbursed, you can deduct what you paid for: Insurance premiums for medical and dental care, including premiums for qualified long-term care contracts as defined in Pub. 502. But see Limit on long-term care premiums you can deduct on page A-2. Reduce the insurance premiums by any self-employed health insurance deduction you claimed on Form 1040, line 29. You cannot deduct insurance premiums paid with pretax dollars because the premiums are not included in box 1 of your Form(s) W-2. If you are a retired public safety officer, you cannot deduct any premiums you paid to the extent they were paid for with a tax-free distribution from your retirement plan.

The deduction for qualified mortgage insurance premiums for mortgage insurance contracts issued after December 31, 2006, was extended through 2010. See the instructions for line 13 on page A-6.
Disaster area casualties and thefts. Special rules apply to casualty and theft losses that occurred in the Kansas disaster area, a Midwestern disaster area, or a federally declared disaster area. See the instructions for line 20 that begin on page A-8. Qualified conservation contributions. The

special deduction limit for qualified conservation contributions has been extended through 2009. See Pub. 526 for more details.

If, during 2008, you were an eligible trade adjustment assistance (TAA) recipient, alternative TAA (ATAA) recipient, or Pension Benefit Guaranty Corpora-

tists, eye doctors, medical doctors, occupational therapists, osteopathic doctors, physical therapists, podiatrists, psychiatrists, psychoanalysts (medical care only), and psychologists. Medical examinations, X-ray and laboratory services, insulin treatment, and whirlpool baths your doctor ordered. Diagnostic tests, such as a full-body scan, pregnancy test, or blood sugar test kit. Nursing help (including your share of the employment taxes paid). If you paid someone to do both nursing and housework, you can deduct only the cost of the nursing help. Hospital care (including meals and lodging), clinic costs, and lab fees. Qualified long-term care services (see Pub. 502). The supplemental part of Medicare insurance (Medicare B). The premiums you pay for Medicare Part D insurance. A program to stop smoking and for prescription medicines to alleviate nicotine withdrawal. A weight-loss program as treatment for a specific disease (including obesity) diagnosed by a doctor. Medical treatment at a center for drug or alcohol addiction. Medical aids such as eyeglasses, contact lenses, hearing aids, braces, crutches, wheelchairs, and guide dogs, including the cost of maintaining them.

Prescription medicines or insulin. Acupuncturists, chiropractors, den-

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Surgery to improve defective vision, such as laser eye surgery or radial keratotomy. Lodging expenses (but not meals) while away from home to receive medical care in a hospital or a medical care facility related to a hospital, provided there was no significant element of personal pleasure, recreation, or vacation in the travel. Do not deduct more than $50 a night for each eligible person. Ambulance service and other travel costs to get medical care. If you used your own car, you can claim what you spent for gas and oil to go to and from the place you received the care; or you can claim 19 cents a mile (27 cents a mile after June 30, 2008). Add parking and tolls to the amount you claim under either method.
Note. Certain medical expenses paid out of

(FDA). This includes foreign-made versions of U.S.-approved drugs manufactured without FDA approval. Nonprescription medicines (including nicotine gum and certain nicotine patches). Travel your doctor told you to take for rest or a change. Funeral, burial, or cremation costs.

1 any medical and dental expenses you paid in 2008 for your mother.
Reimbursements. If your insurance com-

Line 1
Medical and Dental Expenses
Enter the total of your medical and dental expenses (see page A-1), after you reduce these expenses by any payments received from insurance or other sources. See Reimbursements on this page.

pany paid the provider directly for part of your expenses, and you paid only the amount that remained, include on line 1 only the amount you paid. If you received a reimbursement in 2008 for medical or dental expenses you paid in 2008, reduce your 2008 expenses by this amount. If you received a reimbursement in 2008 for prior year medical or dental expenses, do not reduce your 2008 expenses by this amount. But if you deducted the expenses in the earlier year and the deduction reduced your tax, you must include the reimbursement in income on Form 1040, line 21. See Pub. 502 for details on how to figure the amount to include.
Cafeteria plans. Do not include on line 1

a deceased taxpayer's estate can be claimed on the deceased taxpayer's final return. See Pub. 502 for details.
Limit on long-term care premiums you can deduct. The amount you can deduct for

qualified long-term care contracts (as defined in Pub. 502) depends on the age, at the end of 2008, of the person for whom the premiums were paid. See the chart below for details.
IF the person was, at the end of 2008, age . . . THEN the most you can deduct is . . .

Do not forget to include insurance premiums you paid for TIP medical and dental care. But if you claimed the self-employed health insurance deduction on Form 1040, line 29, reduce the premiums by the amount on line 29.
Note. If, during 2008, you were an eligible trade adjustment assistance (TAA) recipient, alternative TAA (ATAA) recipient, or Pension Benefit Guaranty Corporation pension recipient, you must complete Form 8885 before completing Schedule A, line 1. When figuring the amount of insurance premiums you can deduct on Schedule A, do not include: Any amounts you included on Form 8885, line 4, Any qualified health insurance premiums you paid to "U.S. Treasury -- HCTC," or Any health coverage tax credit advance payments shown in box 1 of Form 1099-H. Whose medical and dental expenses can you include? You can include medical and

insurance premiums paid by an employer-sponsored health insurance plan (cafeteria plan) unless the premiums are included in box 1 of your Form(s) W-2. Also, do not include any other medical and dental expenses paid by the plan unless the amount paid is included in box 1 of your Form(s) W-2.

Taxes You Paid
Taxes You Cannot Deduct Federal income and excise taxes. Social security, Medicare, federal un-

40 or under 4150 5160 6170 71 or older

$ 310 $ 580 $ 1,150 $ 3,080 $ 3,850

sary to improve a deformity related to a congenital abnormality, an injury from an accident or trauma, or a disfiguring disease. Life insurance or income protection policies. The Medicare tax on your wages and tips or the Medicare tax paid as part of the self-employment tax or household employment taxes.

Examples of Medical and Dental Payments You Cannot Deduct The cost of diet food. Cosmetic surgery unless it was neces-

employment (FUTA), and railroad retirement (RRTA) taxes. Customs duties. Federal estate and gift taxes. But see the instructions for line 28 on page A-10. Certain state and local taxes, including: tax on gasoline, car inspection fees, assessments for sidewalks or other improvements to your property, tax you paid for someone else, and license fees (marriage, driver's, dog, etc.).

If you were age 65 or older but not entitled to social security benefits, you can deduct premiums you voluntarily paid for Medicare A coverage. Nursing care for a healthy baby. But you may be able to take a credit for the amount you paid. See the instructions for Form 1040, line 48. Illegal operations or drugs. Imported drugs not approved by the U.S. Food and Drug Administration

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dental bills you paid for anyone who was one of the following either when the services were provided or when you paid for them. Yourself and your spouse. All dependents you claim on your return. Your child whom you do not claim as a dependent because of the rules for children of divorced or separated parents. Any person you could have claimed as a dependent on your return except that person received $3,500 or more of gross income or filed a joint return. Any person you could have claimed as a dependent except that you, or your spouse if filing jointly, can be claimed as a dependent on someone else's 2008 return.
Example. You provided over half of your mother's support but cannot claim her as a dependent because she received wages of $3,500 in 2008. You can include on line

Line 5
You can elect to deduct state and local general sales taxes instead of state and local income taxes. You cannot deduct both.

State and Local Income Taxes
If you deduct state and local income taxes, check box a on line 5. Include on this line the state and local income taxes listed below. State and local income taxes withheld from your salary during 2008. Your Form(s) W-2 will show these amounts. Forms W-2G, 1099-G, 1099-R, and 1099-MISC may also show state and local income taxes withheld. State and local income taxes paid in 2008 for a prior year, such as taxes paid

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with your 2007 state or local income tax return. Do not include penalties or interest. State and local estimated tax payments made during 2008, including any part of a prior year refund that you chose to have credited to your 2008 state or local income taxes. Mandatory contributions you made to the California, New Jersey, or New York Nonoccupational Disability Benefit Fund, Rhode Island Temporary Disability Benefit Fund, or Washington State Supplemental Workmen's Compensation Fund. Mandatory contributions to the Alaska, New Jersey, or Pennsylvania state unemployment fund. Do not reduce your deduction by any: State or local income tax refund or credit you expect to receive for 2008, or Refund of, or credit for, prior year state and local income taxes you actually received in 2008. Instead, see the instructions for Form 1040, line 10.

Optional Sales Tax Tables Instead of using your actual expenses, you can use the tables on pages A-11 through A-13 to figure your state and local general sales tax deduction. You may also be able to add the state and local general sales taxes paid on certain specified items. To figure your state and local general sales tax deduction using the tables, complete the worksheet on page A-4 or use the 2008 Sales Tax Deduction Calculator on the IRS website. To use the 2008 Sales Tax Deduction Calculator, go to www.irs.gov and enter "Sales tax deduction calculator" in the search box.
If your filing status is married filing separately, both you and your spouse elect to deduct sales taxes, and your spouse elects to use the optional sales tax tables, you also must use the tables to figure your state and local general sales tax deduction. Instructions for Line 5b Worksheet Line 1. If you lived in the same state for all of 2008, enter the applicable amount, based on your 2008 income and exemptions, from the optional state sales tax table for your state on page A-11 or A-12. Read down the "At least But less than" columns for your state and find the line that includes your 2008 income. If married filing separately, do not include your spouse's income. Your 2008 income is the amount shown on your Form 1040, line 38, plus any nontaxable items, such as the following. Tax-exempt interest. Veterans' benefits. Nontaxable combat pay. Workers' compensation. Nontaxable part of social security and railroad retirement benefits. Nontaxable part of IRA, pension, or annuity distributions. Do not include rollovers. Public assistance payments. The exemptions column refers to the number of exemptions claimed on Form 1040, line 6d.
What if you lived in more than one state? If you lived in more than one state during 2008, look up the table amount for each state using the above rules. If there is no table for your state, the table amount is considered to be zero. Multiply the table amount for each state you lived in by a fraction. The numerator of the fraction is the number of days you lived in the state during 2008 and the denominator is the total number of days in the year (366). Enter the total of the prorated table amounts for each state on line 1. However, if you also lived in a locality during 2008 that imposed a local general sales tax, do not enter the total on line 1. Instead, complete a separate worksheet for each state you lived in and enter the prorated amount for that state on line 1. Example. You lived in State A from January 1 through August 31, 2008 (244 days), and in State B from September 1 through December 31, 2008 (122 days).

The table amount for State A is $500. The table amount for State B is $400. You would figure your state general sales tax as follows.
State A: State B: Total $500 x 244/366 = $400 x 122/366 = = $333 133 $466

State and Local General Sales Taxes
If you elect to deduct state and local general sales taxes, you must check box b on line 5. To figure your deduction, you can use either your actual expenses or the optional sales tax tables.

Actual Expenses
Generally, you can deduct the actual state and local general sales taxes (including compensating use taxes) you paid in 2008 if the tax rate was the same as the general sales tax rate. However, sales taxes on food, clothing, medical supplies, and motor vehicles are deductible as a general sales tax even if the tax rate was less than the general sales tax rate. If you paid sales tax on a motor vehicle at a rate higher than the general sales tax rate, you can deduct only the amount of tax that you would have paid at the general sales tax rate on that vehicle. Motor vehicles include cars, motorcycles, motor homes, recreational vehicles, sport utility vehicles, trucks, vans, and off-road vehicles. Also include any state and local general sales taxes paid for a leased motor vehicle. Do not include sales taxes paid on items used in your trade or business.

You must keep your actual receipts showing general sales taxes paid to use this method.
Refund of general sales taxes. If you received a refund of state or local general sales taxes in 2008 for amounts paid in 2008, reduce your actual 2008 state and local general sales taxes by this amount. If you received a refund of state or local general sales taxes in 2008 for prior year purchases, do not reduce your 2008 state and local general sales taxes by this amount. But if you deducted your actual state and local general sales taxes in the earlier year and the deduction reduced your tax, you may have to include the refund in income on Form 1040, line 21. See Recoveries in Pub. 525 for details.

If none of the localities in which you lived during 2008 imposed a local general sales tax, enter $466 on line 1 of your worksheet. Otherwise, complete a separate worksheet for State A and State B. Enter $333 on line 1 of the State A worksheet and $133 on line 1 of the State B worksheet. Line 2. If you checked the "No" box, enter -0- on line 2, and go to line 3. If you checked the "Yes" box and lived in the same locality for all of 2008, enter the applicable amount, based on your 2008 income and exemptions, from the optional local sales tax table for your locality on page A-13. Read down the "At least But less than" columns for your locality and find the line that includes your 2008 income. See the line 1 instructions on this page to figure your 2008 income. The exemptions column refers to the number of exemptions claimed on Form 1040, line 6d. What if you lived in more than one locality? If you lived in more than one locality during 2008, look up the table amount for each locality using the above rules. If there is no table for your locality, the table amount is considered to be zero. Multiply the table amount for each locality you lived in by a fraction. The numerator of the fraction is the number of days you lived in the locality during 2008 and the denominator is the total number of days in the year (366). If you lived in more than one locality in the same state and the local general sales tax rate was the same for each locality, enter the total of the prorated table amounts for each locality in that state on line 2. Otherwise, complete a separate worksheet for lines 2 through 6 for each locality and enter each prorated table amount on line 2 of the applicable worksheet. Example. You lived in Locality 1 from January 1 through August 31, 2008 (244 days), and in Locality 2 from September 1 through December 31, 2008 (122 days). The table amount for Locality 1 is $100. The table amount for Locality 2 is $150. You would figure the amount to enter on line 2 as follows. Note that this amount may not equal your local sales tax deduction, which is figured on line 6 of the worksheet.
Locality 1: Locality 2: Total $100 x 244/366 = $150 x 122/366 = = $ 67 50 $117

Line 3. If you lived in California, check the "No" box if your combined state and local general sales tax rate is 7.25%. Otherwise, check the "Yes" box and include on line 3 only the part of the combined rate that is more than 7.25%. If you lived in Nevada, check the "No" box if your combined state and local general sales tax rate is 6.5%. Otherwise, check the "Yes" box and include on line 3 only

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the part of the combined rate that is more than 6.5%.
What if your local general sales tax rate changed during 2008? If you checked the "Yes" box and your local general sales tax rate changed during 2008, figure the rate to enter on line 3 as follows. Multiply each tax rate for the period it was in effect by a fraction. The numerator of the fraction is the number of days the rate was in effect

during 2008 and the denominator is the total number of days in the year (366). Enter the total of the prorated tax rates on line 3.
Example. Locality 1 imposed a 1% local general sales tax from January 1 through September 30, 2008 (274 days). The rate increased to 1.75% for the period from October 1 through December 31, 2008 (92 days). You would enter "1.189" on line 3, figured as follows.

January 1 September 30: October 1 December 31: Total

1.00 x 274/366 = 1.75 x 92/366 = =

0.749 0.440 1.189

What if you lived in more than one locality in the same state during 2008? Complete a separate worksheet for lines 2 through 6 for each locality in your state if you lived in more than one locality in the

State and Local General Sales Tax Deduction Worksheet--Line 5b (See the Instructions for Line 5b Worksheet that begin on page A-3.)
Before you begin: See the instructions for line 1 on page A-3 if:
You lived in more than one state during 2008, or You had any nontaxable income in 2008.

Keep for Your Records

1. Enter your state general sales taxes from the applicable table on page A-11 or A-12 (see page A-3 of the instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1. $ Next. If, for all of 2008, you lived only in Connecticut, the District of Columbia, Indiana, Kentucky, Maine, Maryland, Massachusetts, Michigan, New Jersey, Rhode Island, or West Virginia, skip lines 2 through 5, enter -0- on line 6, and go to line 7. Otherwise, go to line 2. 2. Did you live in Alaska, Arizona, Arkansas, California (Los Angeles County only), Colorado, Georgia, Illinois, Louisiana, Missouri, New York State, North Carolina, South Carolina, Tennessee, Utah, or Virginia in 2008? No. Enter -0Yes. Enter your local general sales taxes from the applicable table on page A-13 (see page A-3 of the instructions)

3. Did your locality impose a local general sales tax in 2008? Residents of California and Nevada see page A-3 of the instructions. No. Skip lines 3 through 5, enter -0- on line 6, and go to line 7. Yes. Enter your local general sales tax rate, but omit the percentage sign. For example, if your local general sales tax rate was 2.5%, enter 2.5. If your local general sales tax rate changed or you lived in more than one locality in the same state during 2008, see above. (If you do not know your local general sales tax rate, contact your local government.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3. 4. Did you enter -0- on line 2 above? No. Skip lines 4 and 5 and go to line 6. Yes. Enter your state general sales tax rate (shown in the table heading for your state), but omit the percentage sign. For example, if your state general sales tax rate is 6%, enter 6.0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. 5. Divide line 3 by line 4. Enter the result as a decimal (rounded to at least three places) 5. 6. Did you enter -0- on line 2 above? No. Multiply line 2 by line 3 Yes. Multiply line 1 by line 5. If you lived in more than one locality in the same state during 2008, see the instructions above

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. . . . . . . . . . . . . . . . . . . 6. $

7. Enter your state and local general sales taxes paid on specified items, if any (see page A-5 of the instructions) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. $ 8. Deduction for general sales taxes. Add lines 1, 6, and 7. Enter the result here and the total from all your state and local general sales tax deduction worksheets, if you completed more than one, on Schedule A, line 5. Be sure to check box b on that line . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8. $

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same state during 2008 and either of the following applies. Each locality did not have the same local general sales tax rate. You lived in Los Angeles County, CA. To figure the amount to enter on line 3 of the worksheet for each locality in which you lived (except a locality for which you used the table on page A-13 to figure your local general sales tax deduction), multiply the local general sales tax rate by a fraction. The numerator of the fraction is the number of days you lived in the locality during 2008 and the denominator is the total number of days in the year (366). Example. You lived in Locality 1 from January 1 through August 31, 2008 (244 days), and in Locality 2 from September 1 through December 31, 2008 (122 days). The local general sales tax rate for Locality 1 is 1%. The rate for Locality 2 is 1.75%. You would enter "0.667" on line 3 for the Locality 1 worksheet and "0.583" for the Locality 2 worksheet, figured as follows.
Locality 1: Locality 2: 1.00 x 244/366 = 1.75 x 122/366 = 0.667 0.583

of the home or substantial addition or the performance of a major renovation. The contract must state that the contractor is authorized to act in your name and must follow your directions on construction decisions. In this case, you will be considered to have purchased any items subject to a sales tax and to have paid the sales tax directly. Do not include sales taxes paid on items used in your trade or business. If you received a refund of state or local general sales taxes in 2008, see Refund of general sales taxes on page A-3.

on how to figure the amount to include in income.

Line 7
Personal Property Taxes
Enter the state and local personal property taxes you paid, but only if the taxes were based on value alone and were imposed on a yearly basis.
Example. You paid a yearly fee for the registration of your car. Part of the fee was based on the car's value and part was based on its weight. You can deduct only the part of the fee that was based on the car's value.

Line 6
Real Estate Taxes
Include taxes (state, local, or foreign) you paid on real estate you own that was not used for business, but only if the taxes are based on the assessed value of the property. Also, the assessment must be made uniformly on property throughout the community, and the proceeds must be used for general community or governmental purposes. Pub. 530 explains the deductions homeowners can take. Do not include the following amounts on line 6. Itemized charges for services to specific property or persons (for example, a $20 monthly charge per house for trash collection, a $5 charge for every 1,000 gallons of water consumed, or a flat charge for mowing a lawn that had grown higher than permitted under a local ordinance). Charges for improvements that tend to increase the value of your property (for example, an assessment to build a new sidewalk). The cost of a property improvement is added to the basis of the property. However, a charge is deductible if it is used only to maintain an existing public facility in service (for example, a charge to repair an existing sidewalk, and any interest included in that charge). If your mortgage payments include your real estate taxes, you can deduct only the amount the mortgage company actually paid to the taxing authority in 2008. If you sold your home in 2008, any real estate tax charged to the buyer should be shown on your settlement statement and in box 5 of any Form 1099-S you received. This amount is considered a refund of real estate taxes. See Refunds and rebates below. Any real estate taxes you paid at closing should be shown on your settlement statement. Refunds and rebates. If you received a refund or rebate in 2008 of real estate taxes you paid in 2008, reduce your deduction by the amount of the refund or rebate. If you received a refund or rebate in 2008 of real estate taxes you paid in an earlier year, do not reduce your deduction by this amount. Instead, you must include the refund or rebate in income on Form 1040, line 21, if you deducted the real estate taxes in the earlier year and the deduction reduced your tax. See Recoveries in Pub. 525 for details

Line 8
Other Taxes
If you had any deductible tax not listed on line 5, 6, or 7, list the type and amount of tax. Enter only one total on line 8. Include on this line income tax you paid to a foreign country or U.S. possession.

Line 6. If you lived in more than one local-

ity in the same state during 2008, you should have completed line 1 only on the first worksheet for that state and separate worksheets for lines 2 through 6 for any other locality within that state in which you lived during 2008. If you checked the "Yes" box on line 6 of any of those worksheets, multiply line 5 of that worksheet by the amount that you entered on line 1 for that state on the first worksheet.
Line 7. Enter on line 7 any state and local

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details.

You may want to take a credit for the foreign tax instead of a deduction. See the instructions for Form 1040, line 47, for

Interest You Paid
Whether your interest expense is treated as investment interest, personal interest, or business interest depends on how and when you used the loan proceeds. See Pub. 535 for details. In general, if you paid interest in 2008 that applies to any period after 2008, you can deduct only amounts that apply for 2008.

general sales taxes paid on the following specified items. If you are completing more than one worksheet, include the total for line 7 on only one of the worksheets. 1. A motor vehicle (including a car, motorcycle, motor home, recreational vehicle, sport utility vehicle, truck, van, and off-road vehicle). Also include any state and local general sales taxes paid for a leased motor vehicle. If the state sales tax rate on these items is higher than the general sales tax rate, only include the amount of tax you would have paid at the general sales tax rate. 2. An aircraft or boat, if the tax rate was the same as the general sales tax rate. 3. A home (including a mobile home or prefabricated home) or substantial addition to or major renovation of a home, but only if the tax rate was the same as the general sales tax rate and any of the following applies. a. Your state or locality imposes a general sales tax directly on the sale of a home or on the cost of a substantial addition or major renovation. b. You purchased the materials to build a home or substantial addition or to perform a major renovation and paid the sales tax directly. c. Under your state law, your contractor is considered your agent in the construction

Lines 10 and 11
Home Mortgage Interest
A home mortgage is any loan that is secured by your main home or second home. It includes first and second mortgages, home equity loans, and refinanced mortgages. A home can be a house, condominium, cooperative, mobile home, boat, or similar property. It must provide basic living accommodations including sleeping space, toilet, and cooking facilities.
Limit on home mortgage interest. If you

took out any mortgages after October 13, 1987, your deduction may be limited. Any additional amounts borrowed after October 13, 1987, on a line-of-credit mortgage you had on that date are treated as a mortgage taken out after October 13, 1987. If you refinanced a mortgage you had on October 13, 1987, treat the new mortgage as taken out on or before October 13, 1987. But if you refinanced for more than the balance of

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the old mortgage, treat the excess as a mortgage taken out after October 13, 1987. See Pub. 936 to figure your deduction if either (1) or (2) below applies. If you had more than one home at the same time, the dollar amounts in (1) and (2) apply to the total mortgages on both homes. 1. You took out any mortgages after October 13, 1987, and used the proceeds for purposes other than to buy, build, or improve your home, and all of these mortgages totaled over $100,000 at any time during 2008. The limit is $50,000 if married filing separately. An example of this type of mortgage is a home equity loan used to pay off credit card bills, buy a car, or pay tuition. 2. You took out any mortgages after October 13, 1987, and used the proceeds to buy, build, or improve your home, and these mortgages plus any mortgages you took out on or before October 13, 1987, totaled over $1 million at any time during 2008. The limit is $500,000 if married filing separately.

Otherwise, it is the employer identification number. You must also let the recipient know your SSN. If you do not show the required information about the recipient or let the recipient know your SSN, you may have to pay a $50 penalty. If you and at least one other person (other than your spouse if filing jointly) were liable for and paid interest on the mortgage, and the other person received the Form 1098, attach a statement to your return showing the name and address of that person. To the right of line 11, enter "See attached."

Mortgage insurance provided by the Department of Veterans Affairs and the Rural Housing Service is commonly known as a funding fee and guarantee fee respectively. These fees can be deducted fully in 2008 if the mortgage insurance contract was issued in 2008. Contact the mortgage insurance issuer to determine the deductible amount if it is not included in box 4 of Form 1098.
Prepaid mortgage insurance. If you paid

Line 12
Points Not Reported on Form 1098
Points are shown on your settlement statement. Points you paid only to borrow money are generally deductible over the life of the loan. See Pub. 936 to figure the amount you can deduct. Points paid for other purposes, such as for a lender's services, are not deductible.
Refinancing. Generally, you must deduct

premiums for qualified mortgage insurance that are allocable to periods after 2008, such premiums are treated as paid in the year to which they are allocated. No deduction is allowed for the unamortized balance if the mortgage is satisfied before its term. The two preceding sentences do not apply to qualified mortgage insurance provided by the Department of Veterans Affairs or the Rural Housing Service. If, in 2007, you obtained a mortgage and paid qualified mortgage insurance premiums that are allocable to periods after 2007, you can allocate the premiums over the shorter of the stated term of the mortgage or 84 months, beginning with the month the insurance was obtained. See Pub. 936. At the time these instructions went to print, additional guidance was not yet issued for mortgage insurance premiums that were paid in 2008, but allocable to periods after 2008. For more details, go to www.irs. gov, click on More Forms and Publications, and then on What's Hot in forms and publications, or see Pub. 553, Highlights of 2008 Tax Changes, available in early 2009.
Limit on amount you can deduct. You

If the total amount of all mortgages is more than the fair market value of the home, additional limits apply. See Pub. 936.

Line 10
Enter on line 10 mortgage interest and points reported to you on Form 1098 under your social security number (SSN). If this form shows any refund of overpaid interest, do not reduce your deduction by the refund. Instead, see the instructions for Form 1040, line 21. If you and at least one other person (other than your spouse if filing jointly) were liable for and paid interest on the mortgage, and the interest was reported on Form 1098 under the other person's SSN, report your share of the interest on line 11 (as explained in the line 11 instructions below). If you paid more interest to the recipient than is shown on Form 1098, see Pub. 936 to find out if you can deduct the additional interest. If you can, attach a statement explaining the difference and enter "See attached" to the right of line 10.

points you paid to refinance a mortgage over the life of the loan. This is true even if the new mortgage is secured by your main home. If you used part of the proceeds to improve your main home, you may be able to deduct the part of the points related to the improvement in the year paid. See Pub. 936 for details.

TIP

If you paid off a mortgage early, deduct any remaining points in the year you paid off the mortgage.

Line 13
Qualified Mortgage Insurance Premiums
Enter the qualified mortgage insurance premiums you paid under a mortgage insurance contract issued after December 31, 2006, in connection with home acquisition debt that was secured by your first or second home. See Prepaid mortgage insurance on this page if you paid any premiums allocable to any period after 2008. Box 4 of Form 1098 may show the amount of premiums you paid in 2008. If you and at least one other person (other than your spouse if filing jointly) were liable for and paid the premiums in connection with the loan, and the premiums were reported on Form 1098 under the other person's SSN, report your share of the premiums on line 13. Qualified mortgage insurance is mortgage insurance provided by the Department of Veterans Affairs, the Federal Housing Administration, or the Rural Housing Service, and private mortgage insurance (as defined in section 2 of the Homeowners Protection Act of 1998 as in effect on December 20, 2006).

cannot deduct your mortgage insurance premiums if the amount on Form 1040, line 38, is more than $109,000 ($54,500 if married filing separately). If the amount on Form 1040, line 38, is more than $100,000 ($50,000 if married filing separately), your deduction is limited and you must use the worksheet on page A-7 to figure your deduction.

Line 14
Investment Interest
Investment interest is interest paid on money you borrowed that is allocable to property held for investment. It does not include any interest allocable to passive activities or to securities that generate tax-exempt income. Complete and attach Form 4952 to figure your deduction.
Exception. You do not have to file Form

If you are claiming the mortgage interest credit (for holders of qualified mortgage credit certificates issued by state or local governmental units or agencies), subtract the amount shown on Form 8396, line 3, from the total deductible interest you paid on your home mortgage. Enter the result on line 10.

Line 11
If you did not receive a Form 1098 from the recipient, report your deductible mortgage interest on line 11. If you bought your home from the recipient, be sure to show that recipient's name, identifying number, and address on the dotted lines next to line 11. If the recipient is an individual, the identifying number is his or her social security number (SSN).

4952 if all three of the following apply. 1. Your investment interest expense is not more than your investment income from interest and ordinary dividends minus any qualified dividends. 2. You have no other deductible investment expenses. 3. You have no disallowed investment interest expense from 2007.

A-6

Alaska Permanent Fund dividends, including those reported on Form 8814, are not investment income. For more details, see Pub. 550.

Gifts to Charity
You can deduct contributions or gifts you gave to organizations that are religious, charitable, educational, scientific, or literary in purpose. You can also deduct what you gave to organizations that work to prevent cruelty to children or animals. Certain whaling captains may be able to deduct expenses paid in 2008 for Native Alaskan subsistence bowhead whale hunting activities. See Pub. 526 for details. To verify an organization's charitable status, you can: Check with the organization to which you made the donation. The organization should be able to provide you with verification of its charitable status. See Pub. 78 for a list of most qualified organizations. You can access Pub. 78 on the IRS website at www.irs.gov under Charities and Non-Profits then Contributors. Call our Tax Exempt/Government Entities Customer Account Services at 1-877-829-5500.

ples, etc. Boy Scouts, Boys and Girls Clubs of America, CARE, Girl Scouts, Goodwill Industries, Red Cross, Salvation Army, United Way, etc. Fraternal orders, if the gifts will be used for the purposes listed earlier on this page. Veterans' and certain cultural groups. Nonprofit schools, hospitals, and organizations whose purpose is to find a cure for, or help people who have, arthritis, asthma, birth defects, cancer, cerebral palsy, cystic fibrosis, diabetes, heart disease, hemophilia, mental illness or retardation, multiple sclerosis, muscular dystrophy, tuberculosis, etc. Federal, state, and local governments if the gifts are solely for public purposes.

Examples of Qualified Charitable Organizations Churches, mosques, synagogues, tem-

amount you claim under either method. But do not deduct any amounts that were repaid to you.
Gifts from which you benefit. If you made

a gift and received a benefit in return, such as food, entertainment, or merchandise, you can generally only deduct the amount that is more than the value of the benefit. But this rule does not apply to certain membership benefits provided in return for an annual payment of $75 or less or to certain items or benefits of token value. For details, see Pub. 526.
Example. You paid $70 to a charitable organization to attend a fund-raising dinner and the value of the dinner was $40. You can deduct only $30.
Gifts of $250 or more. You can deduct a gift of $250 or more only if you have a statement from the charitable organization showing the information in (1) and (2) below.

Contributions You Can Deduct
Contributions can be in cash, property, or out-of-pocket expenses you paid to do volunteer work for the kinds of organizations described earlier. If you drove to and from the volunteer work, you can take the actual cost of gas and oil or 14 cents a mile. But, if the volunteer work was to provide relief related to a Midwestern disaster area, the amount is 36 cents a mile (41 cents a mile after June 30, 2008), see Pub. 4492-B for more details. Add parking and tolls to the

1. The amount of any money contributed and a description (but not value) of any property donated. 2. Whether the organization did or did not give you any goods or services in return for your contribution. If you did receive any goods or services, a description and estimate of the value must be included. If you received only intangible religious benefits (such as admission to a religious ceremony), the organization must state this, but

Qualified Mortgage Insurance Premiums Deduction Worksheet-- Line 13
Before you begin:

Keep for Your Records

See the instructions for line 13 on page A-6 to see if you must use this worksheet to figure your deduction.

1. Enter the total premiums you paid in 2008 for qualified mortgage insurance for a contract issued after December 31, 2006 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2. Enter the amount from Form 1040, line 38 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2. 3. Enter $100,000 ($50,000 if married filing separately) . . . . . . . . . . . . . . . . . . . . . . 3. 4. Is the amount on line 2 more than the amount on line 3? No. Your deduction is not limited. Enter the amount from line 1 above on Schedule A, line 13. Do not complete the rest of this worksheet. Yes. Subtract line 3 from line 2. If the result is not a multiple of $1,000 ($500 if married filing separately), increase it to the next multiple of $1,000 ($500 if married filing separately). For example, increase $425 to $1,000, increase $2,025 to $3,000; or if married filing separately, increase $425 to $500, increase $2,025 to $2,500, etc. . . . . . . . . . . . . . . . . . . . . . . . . . 4. 5. Divide line 4 by $10,000 ($5,000 if married filing separately). Enter the result as a decimal. If the result is 1.0 or more, enter 1.0 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6. Multiply line 1 by line 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. Qualified mortgage insurance premiums deduction. Subtract line 6 from line 1. Enter the result here and on Schedule A, line 13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1.

5. 6. 7.

.

A-7

it does not have to describe or value the benefit. In figuring whether a gift is $250 or more, do not combine separate donations. For example, if you gave your church $25 each week for a total of $1,300, treat each $25 payment as a separate gift. If you made donations through payroll deductions, treat each deduction from each paycheck as a separate gift. See Pub. 526 if you made a separate gift of $250 or more through payroll deduction.

You must get the statement by the date you file your return or TIP the due date (including extensions) for filing your return, whichever is earlier. Do not attach the statement to your return. Instead, keep it for your records.
Limit on the amount you can deduct. See

Gifts to individuals and groups that are run for personal profit. Gifts to foreign organizations. But you may be able to deduct gifts to certain U.S. organizations that transfer funds to foreign charities and certain Canadian, Israeli, and Mexican charities. See Pub. 526 for details. Gifts to organizations engaged in certain political activities that are of direct financial interest to your trade or business. See section 170(f)(9). Gifts to groups whose purpose is to lobby for changes in the laws. Gifts to civic leagues, social and sports clubs, labor unions, and chambers of commerce. Value of benefits received in connection with a contribution to a charitable organization. See Pub. 526 for exceptions.

donated property. This amount is $500 for certain contributions of clothing and household items (see below). See Form 8283 and its instructions for details.
Contributions of clothing and household items. A deduction for these contributions

will be allowed only if the items are in good used condition or better. However, this rule does not apply to a contribution of any single item for which a deduction of more than $500 is claimed and for which you include a qualified appraisal and Form 8283 with your tax return.
Recordkeeping. If you gave property, you

Pub. 526 to figure the amount of your deduction if any of the following applies. 1. Your cash contributions or contributions of ordinary income property are more than 30% of the amount on Form 1040, line 38. 2. Your gifts of capital gain property are more than 20% of the amount on Form 1040, line 38. 3. You gave gifts of property that increased in value or gave gifts of the use of property.

Line 16
Gifts by Cash or Check
Enter on line 16 the total gifts you made in cash or by check (including out-of-pocket expenses).
Recordkeeping. For any contribution

The limit described in item (1) above does not apply to certain TIP cash contributions paid for relief efforts in a Midwestern disaster area if you elect to treat those contributions as qualified contributions. See Pub. 526 for details.

made in cash, regardless of the amount, you must maintain as a record of the contribution a bank record (such as a canceled check or credit card statement) or a written record from the charity. The written record must include the name of the charity, date, and amount of the contribution. If you made contributions through payroll deduction, see Pub. 526 for information on the records you must keep. Do not attach the record to your tax return. Instead, keep it with your other tax records.

should keep a receipt or written statement from the organization you gave the property to, or a reliable written record, that shows the organization's name and address, the date and location of the gift, and a description of the property. For each gift of property, you should also keep reliable written records that include: How you figured the property's value at the time you gave it. If the value was determined by an appraisal, keep a signed copy of the appraisal. The cost or other basis of the property if you must reduce it by any ordinary income or capital gain that would have resulted if the property had been sold at its fair market value. How you figured your deduction if you chose to reduce your deduction for gifts of capital gain property. Any conditions attached to the gift.

If your total deduction for gifts of property is over $500, you gave less than your entire interest in the property, or you made a "qualified conservation contribution," your records should contain additional information. See Pub. 526 for details.

lodging) while away from home, unless there was no significant element of personal pleasure, recreation, or vacation in the travel. Political contributions. Dues, fees, or bills paid to country clubs, lodges, fraternal orders, or similar groups. Cost of raffle, bingo, or lottery tickets. But you may be able to deduct these expenses on line 28. See the instructions on page A-10 for details. Cost of tuition. But you may be able to deduct this expense on line 21 (see page A-9), or Form 1040, line 34, or take a credit for this expense (see Form 8863). Value of your time or services. Value of blood given to a blood bank. The transfer of a future interest in tangible personal property (generally, until the entire interest has been transferred).

Contributions You Cannot Deduct Travel expenses (including meals and

Line 17
Other Than by Cash or Check
Enter your contributions of property. If you gave used items, such as clothing or furniture, deduct their fair market value at the time you gave them. Fair market value is what a willing buyer would pay a willing seller when neither has to buy or sell and both are aware of the conditions of the sale. For more details on determining the value of donated property, see Pub. 561. If the amount of your deduction is more than $500, you must complete and attach Form 8283. For this purpose, the "amount of your deduction" means your deduction before applying any income limits that could result in a carryover of contributions. If you deduct more than $500 for a contribution of a motor vehicle, boat, or airplane, you must also attach a statement from the charitable organization to your return. The organization may use Form 1098-C to provide the required information. If your total deduction is over $5,000, you may also have to get appraisals of the values of the

Line 18
Carryover From Prior Year
Enter any carryover of contributions that you could not deduct in an earlier year because they exceeded your adjusted gross income limit. See Pub. 526 for details.

Casualty and Theft Losses
Line 20
Complete and attach Form 4684 to figure the amount of your loss to enter on line 20. You may be able to deduct part or all of each loss caused by theft, vandalism, fire, storm, or similar causes, and car, boat, and other accidents. You may also be able to deduct money you had in a financial institution but lost because of the insolvency or bankruptcy of the institution.

A-8

You can deduct nonbusiness casualty or theft losses only to the extent that: 1. The amount of each separate casualty or theft loss is more than $100, and 2. The total amount of all losses during the year (reduced by the $100 limit discussed in (1) above) is more than 10% of the amount on Form 1040, line 38.
Exceptions for certain disaster losses. Exceptions to the above limitations apply to losses in certain disaster areas. Kansas disaster area. Casualty and theft losses that occurred in the Kansas disaster area after May 3, 2007, are not subject to the $100 and 10% of adjusted gross income (AGI) limitations if the losses were attributable to the storms and tornadoes that began May 4, 2007. See Pub. 4492-A for more details. Midwestern disaster areas. Casualty and theft losses that occurred in a Midwestern disaster area are not subject to the $100 and 10% of AGI limitations if the losses were attributable to the severe storms, tornadoes or flooding. See Pub. 4492-B for more details. Federally declared disaster areas. The 10% of AGI limitation does not apply to a casualty loss in a federally declared disaster. Special rules apply if you had both gains and losses from nonbusiness casualties or thefts. See Form 4684 and its instructions for details. Use Schedule A, line 23, to deduct the costs of proving that you had a property loss. Examples of these costs are appraisal fees and photographs used to establish the amount of your loss. For information on federal disaster area losses, see Pub. 547.

ment exceeds 1 year. See Pub. 529 for an exception for certain federal employees. Travel as a form of education. Expenses of attending a seminar, convention, or similar meeting unless it is related to your employment. Club dues. Expenses of adopting a child. But you may be able to take a credit for adoption expenses. See Form 8839 for details. Fines and penalties. Expenses of producing tax-exempt income.

Line 21
Unreimbursed Employee Expenses
Enter the total ordinary and necessary job expenses you paid for which you were not reimbursed. (Amounts your employer included in box 1 of your Form W-2 are not considered reimbursements.) An ordinary expense is one that is common and accepted in your field of trade, business, or profession. A necessary expense is one that is helpful and appropriate for your business. An expense does not have to be required to be considered necessary. But you must fill in and attach Form 2106 if either (1) or (2) below applies. 1. You claim any travel, transportation, meal, or entertainment expenses for your job. 2. Your employer paid you for any of your job expenses that you would otherwise report on line 21.

Dues to professional organizations and chambers of commerce. Subscriptions to professional journals. Fees to employment agencies and other costs to look for a new job in your present occupation, even if you do not get a new job. Certain business use of part of your home. For details, including limits that apply, use TeleTax topic 509 (see page 84 of the Form 1040 instructions) or see Pub. 587. Certain educational expenses. For details, use TeleTax topic 513 (see page 84 of the Form 1040 instructions) or see Pub. 970. Reduce your educational expenses by any tuition and fees deduction you claimed on Form 1040, line 34.
TIP
You may be able to take a credit for your educational expenses instead of a deduction. See Form 8863 for details.

Line 22
Tax Preparation Fees
Enter the fees you paid for preparation of your tax return, including fees paid for filing your return electronically. If you paid your tax by credit card, do not include the convenience fee you were charged.

Line 23
Other Expenses
Enter the total amount you paid to produce or collect taxable income and manage or protect property held for earning income. But do not include any personal expenses. List the type and amount of each expense on the dotted lines next to line 23. If you need more space, attach a statement showing the type and amount of each expense. Enter one total on line 23. Examples of expenses to include on line 23 are:

Job Expenses and Certain Miscellaneous Deductions
You can deduct only the part of these expenses that exceeds 2% of the amount on Form 1040, line 38. Pub. 529 discusses the types of expenses that can and cannot be deducted.

If you used your own vehicle, are using the standard mileage rate, and (2) above does not apply, you may be able to file Form 2106-EZ instead.

TIP

If you do not have to file Form 2106 or 2106-EZ, list the type and amount of each expense on the dotted line next to line 21. If you need more space, attach a statement showing the type and amount of each expense. Enter the total of all these expenses on line 21.

that do not produce taxable income. Lost or misplaced cash or property. Expenses for meals during regular or extra work hours. The cost of entertaining friends. Commuting expenses. See Pub. 529 for the definition of commuting. Travel expenses for employment away from home if that period of employ-

Examples of Expenses You Cannot Deduct Political contributions. Legal expenses for personal matters

Do not include on line 21 any educator expenses you deducted on Form 1040, line 23.
Examples of other expenses to include on line 21 are: Safety equipment, small tools, and supplies needed for your job. Uniforms required by your employer that are not suitable for ordinary wear. Protective clothing required in your work, such as hard hats, safety shoes, and glasses. Physical examinations required by your employer.

Your share of the investment expenses of a regulated investment company. Certain losses on nonfederally insured deposits in an insolvent or bankrupt financial institution. For details, including limits that apply, see Pub. 529. Casualty and theft losses of property used in performing services as an employee from Form 4684, lines 38 and 44b, or Form 4797, line 18a. Deduction for repayment of amounts under a claim of right if $3,000 or less.

fees.

Certain legal and accounting fees. Clerical help and office rent. Custodial (for example, trust account)

A-9

Other Miscellaneous Deductions
Line 28
Only the expenses listed next can be deducted on this line. List the type and amount of each expense on the dotted lines next to line 28. If you need more space, attach a statement showing the type and amount of each expense. Enter one total on line 28. Gambling losses, but only to the extent of gambling winnings reported on Form 1040, line 21. Casualty and theft losses of income-producing property from Form 4684, lines 38 and 44b, or Form 4797, line 18a. Loss from other activities from Schedule K-1 (Form 1065-B), box 2. Federal estate tax on income in respect of a decedent.

Amortizable bond premium on bonds acquired before October 23, 1986. Deduction for repayment of amounts under a claim of right if over $3,000. See Pub. 525 for details. Certain unrecovered investment in a pension. Impairment-related work expenses of a disabled person. For more details, see Pub. 529.

Form 1040, line 38, is over $159,950 ($79,975 if married filing separately). For line 2 of the worksheet below, you will need to know the amount, if any, of your charitable contributions you elected to treat as qualified contributions for relief efforts in a Midwestern disaster area.

Line 30
If you elect to itemize for state tax or other purposes even though your itemized deductions are less than your standard deduction, check the box on line 30.

Total Itemized Deductions
Line 29
Use the worksheet below to figure the amount to enter on line 29 if the amount on

Itemized Deductions Worksheet--Line 29

Keep for Your Records
1.

1. Enter the total of the amounts from Schedule A, lines 4, 9, 15, 19, 20, 27, and 28 . . . . . . . . . . . . . . 2. Enter the total of the amounts from Schedule A, lines 4, 14, and 20, plus any gambling and casualty or theft losses included on line 28. Also include in the total any amount included on Schedule A, line 16, that you elected to treat as qualified contributions for relief efforts in a Midwestern disaster area . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Be sure your total gambling and casualty or theft losses are clearly identified on the dotted lines next to line 28.

2.

3. Is the amount on line 2 less than the amount on line 1? STOP No. Your deduction is not limited. Enter the amount from line 1 above on Schedule A, line 29. Yes. Subtract line 2 from line 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3. 4. Multiply line 3 by 80% (.80) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. 5. Enter the amount from Form 1040, line 38 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. 6. Enter $159,950 ($79,975) if married filing separately) . . . . . . . . . . . . . . . . . . . 6. 7. Is the amount on line 6 less than the amount on line 5? STOP No. Your deduction is not limited. Enter the amount from line 1 above on Schedule A, line 29. Yes. Subtract line 6 from line 5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. 8. Multiply line 7 by 3% (.03) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8. 9. Enter the smaller of line 4 or line 8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9. 10. Divide line 9 by 1.5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10. 11. Subtract line 10 from line 9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11. 12. Total itemized deductions. Subtract line 11 from line 1. Enter the result here and on Schedule A, line 29 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.

A-10

2008 Optional State and Certain Local Sales Tax Tables
Income
At least But less than 1 2

Exemptions
3 4 5 Over 5 1 2

Exemptions
3 4 5 Over 5 1 2

Exemptions
3 4 5 Over 5 1 2

Exemptions
3
1

Exemptions
5 Over 5 1 2 3 4 5 Over 5

4

Alabama
201 310 364 411 453 491 527 560 592 633 690 740 790 835 246 377 442 497 546 591 634 673 710 278 423 495 557 612 661 708 751 792

4.0000% Arizona
303 460 538 604 663 717 767 814 857 324 491 574 644 707 764 817 866 912 973 1057 1129 1201 1266 354 535 625 701 769 830 888 941 991 205 350 427 494 556 612 667 718 766 234 397 484 560 629 693 754 811 866 253 429 522 604 678 747 812 873 932

5.6000% Arkansas
267 453 551 637 279 472 575 664 295 500 608 702 287 469 563 644 334 544 652 746 366 594 712 813

6.0000% California
390 633 758 866 963 1051 1135 1213 1287 1384 1518 1635 1752 1858 410 665 796 909 1010 1103 1191 1272 1350 1452 1592 1714 1837 1948 438 709 849 969 1077 1175 1269 1355 1437 1546 1695 1825 1955 2072 246 423 518 601 280 480 587 681

7.2500% Colorado
320 547 668 774 334 571 696 806 907 1000 1088 1171 1251 1356 1502 1631 1761 1879 354 603 736 852 958 1056 1149 1236 1320 1430 1584 1720 1856 1980 96 161 195 225 253 278 302 325 347 375 415 450 485 517 681 110 184 223 257 288 317 344 370 394 426 471 510 550 586 768 120 200 242 279 312 343 372 399 425 460 508 550 592 631 826

2.9000%
127 212 256 295 330 363 393 422 450 486 536 581 625 666 871 133 222 268 308 345 379 411 441 470 507 560 606 652 694 908 142 235 285 327 366 402 436 467 497 537 593 641 690 734 959

$0 $20,000 20,000 30,000 30,000 40,000 40,000 50,000 50,000 60,000 60,000 70,000 70,000 80,000 80,000 90,000 90,000 100,000 100,000 120,000 140,000 160,000 180,000 120,000 140,000 160,000 180,000 200,000

303 518 633 734

715 745 788 787 821 867 856 892 942 920 959 1012 982 1023 1080 1063 1176 1276 1376 1467 1107 1225 1328 1433 1527 1169 1292 1401 1511 1610

717 830 905 784 907 988 848 979 1067 907 1047 1141 962 1111 1210 1036 1138 1227 1316 1397 1196 1312 1414 1516 1609 1302 1429 1539 1650 1749

678 767 825 870 748 846 910 960 815 922 991 1045 879 992 1067 1124 939 1060 1140 1201 1019 1131 1230 1330 1420 1150 1275 1386 1497 1599 1236 1370 1488 1608 1716 1302 1443 1567 1692 1805

759 846 915 825 919 994 883 983 1062 941 1047 1131 994 1104 1192

1056 831 938 1009 1146 920 1039 1117 1224 1000 1128 1212 1301 1079 1217 1307 1371 1152 1298 1394

200,000 or more

1060 1254 1390 1497 1587 1715 1522 1711 1836 1931 2008 2116 1801 2070 2250 2387 2501 2660 1885 2117 2269 2385 2481 2613

Income
$0 $20,000 20,000 30,000 30,000 40,000 40,000 50,000 50,000 60,000 60,000 70,000 70,000 80,000 80,000 90,000 90,000 100,000 100,000 120,000 140,000 160,000 180,000

Connecticut
208 356 433 501 563 620 675 725 774 231 393 479 554 622 685 744 800 853 245 417 508 587 659 726 789 848 905

6.0000% District of Columbia
256 435 530 612 688 757 823 884 943 1021 1129 1223 1319 1405 264 450 547 633 276 470 572 661 165 285 349 405 456 503 548 591 631 186 319 391 453 510 563 613 660 705 200 342 418 485 545 601 655 705 753 210 359 439 509 572 631 687 739 789

5.7500% Florida
219 374 456 528 594 655 713 767 819 230 393 480 555 625 688 749 806 860 210 359 438 507 571 629 685 738 788 244 414 504 584 656 722 786 845 902 978 1082 1175 1268 1352 266 451 549 634

6.0000% Georgia
283 479 583 674 297 502 611 706 317 535 650 751 142 236 286 329 368 404 438 470 501 541 597 647 697 742 163 270 326 375 419 459 498 534 568 614 676 732 787 838 177 293 353 405 452 496 537 576 612 661 728 788 847 901

4.0000% Hawaii
188 310 373 428 478 524 567 608 647 698 768 831 893 950 197 324 390 447 499 547 592 634 675 209 343 413 474 529 579 627 671 713 239 378 447 507 561 609 655 697 738 283 445 526 596 658 715 768 817 864 925 1009 1083 1155 1221 313 490 579 656

4.0000%
335 525 621 702 354 555 655 741 381 596 703 795

711 742 782 817 850 887 914 954 974 1017 1055 1166 1264 1362 1451 1101 1217 1319 1421 1514

712 756 792 843 784 832 872 927 853 905 948 1008 917 973 1019 1083 979 1038 1086 1154 1060 1173 1273 1373 1464 1124 1243 1348 1454 1550 1176 1301 1411 1521 1621 1250 1381 1498 1614 1721

724 775 818 877 786 841 887 952 844 904 953 1021 898 961 1013 1086 949 1015 1070 1147 1016 1108 1188 1267 1339 1087 1185 1270 1354 1430 1145 1248 1337 1426 1506 1227 1337 1433 1527 1613

120,000 838 924 979 140,000 927 1022 1083 160,000 1005 1108 1174 180,000 1084 1194 1265 200,000 1156 1273 1348 200,000 or more 1518 1671 1769

685 765 816 856 888 933 854 760 848 905 948 984 1033 946 826 921 983 1030 1068 1121 1028 893 995 1061 1112 1153 1210 1110 954 1062 1133 1186 1230 1291 1185

728 770 791 801 847 863 866 915 926 931 983 989 990 1045 1046

1843 1903 1985 1264 1405 1496 1566 1623 1702 1567 1784 1928 2040 2131 2260

971 1094 1174 1236 1287 1358 1328 1546 1694 1808 1903 2035

Income
$0 $20,000 20,000 30,000 30,000 40,000 40,000 50,000 50,000 60,000 60,000 70,000 70,000 80,000 80,000 90,000 90,000 100,000 100,000 120,000 140,000 160,000 180,000 120,000 140,000 160,000 180,000 200,000

Idaho
304 470 555 627 370 569 669 754 416 637 748 843

6.0000% Illinois
452 692 811 913 1004 1086 1164 1235 1303 1392 1514 1620 1725 1820 482 526 737 802 864 939 972 1056 1068 1155 1237 1313 1385 1479 1607 1719 1830 1931 1160 1254 1342 1424 1501 1602 1740 1860 1980 2087 240 401 486 560 627 689 748 804 856 926 1023 1108 1193 1271 277 461 557 641 301 500 605 695

6.2500% Indiana3
320 531 641 737 335 556 671 771 357 591 713 819 915 1003 1087 1165 1239 1338 1474 1593 1713 1822 257 421 506 580 646 707 765 819 870 938 1032 1114 1196 1271 297 484 581 665 323 526 631 722

6.7514% Iowa3
344 559 670 766 360 585 701 802 384 623 746 852 222 376 457 528 593 652 709 761 811 254 429 522 602 675 742 807 866 923 275 464 564 651

5.5027% Kansas
291 491 596 688 304 513 623 718 322 543 659 760 282 442 524 593 341 533 629 711 382 595 702 793

5.3000%
414 644 759 857 441 685 807 911 479 743 876 988 1088 1179 1265 1344 1418 1516 1650 1766 1881 1985

691 831 927 750 900 1004 806 966 1076 857 1026 1143 906 1083 1206 971 1059 1136 1213 1283 1159 1262 1352 1442 1523 1289 1403 1502 1600 1689

718 778 824 862 788 854 904 945 855 926 980 1024 917 993 1051 1098 977 1057 1118 1169 1056 1165 1261 1357 1445 1142 1259 1362 1466 1560 1208 1331 1440 1549 1648 1262 1391 1504 1618 1721

741 804 852 892 947 810 879 931 974 1035 876 950 1006 1053 1117 937 1016 1076 1125 1194 995 1078 1142 1194 1267 1072 1178 1271 1364 1448 1161 1275 1375 1476 1566 1229 1350 1455 1561 1656 1286 1411 1521 1631 1731

729 771 805 852 802 847 885 936 871 920 961 1017 935 988 1031 1091 997 1053 1099 1163 1139 1257 1361 1466 1561 1188 1312 1420 1529 1628 1257 1388 1502 1617 1722

655 785 875 945 1004 712 852 949 1025 1089 765 915 1018 1100 1168 814 973 1083 1169 1241 861 1028 1144 1234 1310 923 1007 1080 1153 1219 1101 1200 1286 1372 1449 1223 1333 1428 1523 1608 1320 1437 1540 1641 1733 1401 1525 1633 1741 1837

1364 878 999 1078 1497 970 1103 1190 1613 1051 1195 1289 1729 1133 1287 1389 1834 1207 1371 1479

200,000 or more

1633 1928 2132 2293 2428 2620 1667 1889 2037 2150 2243 2372 1647 1872 2022 2136 2231 2362 1581 1794 1934 2040 2128 2249 1548 1834 2031 2185 2315 2499

Income
$0 $20,000 20,000 30,000 30,000 40,000 40,000 50,000 50,000 60,000 60,000 70,000 70,000 80,000 80,000 90,000 90,000 100,000 100,000 120,000 140,000 160,000 180,000

Kentucky
215 352 424 486 543 595 644 691 735 249 406 488 559 623 682 738 790 839 272 442 530 607 676 739 800 856 909 980 1077 1163 1249 1327

6.0000% Louisiana
289 470 563 644 304 493 590 675 324 525 628 718 158 268 326 377 423 466 507 545 581 629 696 755 814 867 178 302 367 424 476 523 569 611 652 192 324 393 454 510 560 609 654 697

4.0000% Maine
202 340 414 477 535 589 640 687 732 210 354 430 496 556 612 664 714 761 221 373 453 522 585 644 699 751 800 141 243 298 346 390 430 469 506 540 587 652 709 767 819 160 274 335 389 438 483 527 567 606 658 729 793 857 915 172 295 360 417 470 518 564 608 649

5.0000% Maryland3
182 310 379 439 494 545 593 638 682 190 323 394 457 514 566 617 664 709 200 341 416 481 541 597 649 699 746 218 371 451 522 586 646 703 756 807 246 416 506 585 656 722 785 844 900 974 1077 1168 1260 1343 265 447 543 626

5.9945% Massachusetts
279 470 571 658 291 489 594 685 307 516 626 721 155 263 320 371 417 459 500 538 574 622 689 748 807 861 172 292 355 411 461 508 552 594 633 184 311 378 436 490 539 586 630 672

5.0000%
193 325 395 456 512 563 612 657 701 200 336 409 472 529 582 633 680 725 209 352 428 494 554 609 661 710 757

717 751 798 784 821 872 848 887 942 907 949 1008 963 1008 1070 1038 1140 1231 1321 1403 1085 1192 1286 1380 1466 1152 1265 1364 1463 1553

703 738 767 808 773 812 844 888 840 882 916 964 902 947 984 1035 962 1009 1048 1102 1041 1150 1247 1344 1432 1092 1206 1307 1408 1500 1134 1252 1357 1461 1557 1192 1316 1426 1535 1635

120,000 793 905 140,000 873 996 160,000 944 1076 180,000 1016 1156 200,000 1080 1228 200,000 or more 1409 1596

705 755 792 823 865 780 834 875 909 955 845 904 948 985 1035 911 974 1022 1061 1115 971 1038 1088 1130 1187

704 739 768 808 874 781 819 851 895 967 848 890 925 972 1050 916 962 998 1050 1133 978 1026 1066 1120 1209

686 727 759 784 819 759 804 839 867 905 823 872 910 940 981 888 941 981 1013 1058 947 1003 1045 1080 1127

1721 1817 1896 2006 1140 1274 1360 1426 1480 1554 1089 1214 1296 1358 1409 1479 1594 1766 1880 1967 2039 2140 1136 1247 1319 1374 1418 1479

Income
$0 $20,000 20,000 30,000 30,000 40,000 40,000 50,000 50,000 60,000 60,000 70,000 70,000 80,000 80,000 90,000 90,000 100,000 100,000 120,000 140,000 160,000 180,000

Michigan
219 371 451 521 585 645 701 754 804 249 420 510 589 661 727 790 849 905 268 452 549 633

6.0000% Minnesota
283 476 578 667 296 497 602 695 313 524 636 733 209 362 444 517 583 644 702 757 809 231 401 492 572 644 712 776 836 894 246 426 522 607 684 755 824 887 948

6.5000% Mississippi
257 445 545 634 266 460 564 655 279 482 590 685 387 609 720 816

7.0000% Missouri
169 283 344 396 444 489 531 570 608 194 325 394 454 509 559 606 651 694 212 353 428 492 551 605 657 705 751

4.2250% Nebraska
225 375 453 522 584 641 695 746 794 236 392 475 546 611 670 727 780 830 251 417 504 580 648 711 771 827 880 224 378 459 530 594 653 710 762 812 252 426 517 596 668 735 798 857 913 987 1090 1180 1271 1353 271 457 554 639

5.5000%
285 480 583 672 297 499 606 698 313 526 638 735

463 515 555 589 637 724 803 865 917 990 856 949 1021 1082 1167 969 1073 1154 1222 1318 1069 1161 1246 1326 1401 1500 1636 1754 1871 1977 1183 1284 1378 1466 1548 1657 1805 1935 2063 2179 1273 1380 1481 1575 1663 1780 1938 2077 2214 2338 1347 1461 1567 1666 1759 1882 2049 2195 2339 2470 1452 1574 1689 1794 1894 2026 2205 2361 2516 2656

710 748 778 821 781 822 856 902 848 893 929 980 911 959 998 1052 972 1022 1063 1121 1106 1222 1324 1427 1520 1150 1271 1377 1483 1580

714 738 772 902 788 815 852 980 860 889 929 1053 926 957 1000 1121 990 1023 1069 1185 1074 1191 1295 1399 1494 1110 1231 1338 1446 1544 1160 1286 1398 1510 1612 1270 1386 1487 1588 1679

716 753 782 823 787 827 860 905 855 898 933 982 918 964 1002 1054 978 1027 1067 1122 1057 1167 1264 1361 1449 1110 1226 1327 1429 1521 1154 1273 1378 1484 1580 1213 1339 1449 1560 1660

120,000 871 980 1051 140,000 964 1084 1162 160,000 1046 1175 1260 180,000 1128 1267 1358 200,000 1203 1350 1447 200,000 or more 1585 1775 1899

1212 879 970 1030 1338 975 1077 1142 1450 1061 1171 1241 1561 1147 1265 1342 1663 1225 1351 1433 1994 2071 2178 1624 1790 1896

657 750 811 858 897 951 879 726 828 895 947 989 1048 971 787 897 969 1025 1070 1134 1052 849 966 1043 1103 1152 1220 1133 904 1028 1111 1174 1226 1298 1206

1977 2042 2132 2131 2501 2754 2951 3115 3346 1187 1346 1452 1533 1600 1693 1579 1769 1893 1986 2063 2168

(Continued on next page)

A-11

2008 Optional State and Certain Local Sales Tax Tables (Continued)
Income
At least But less than 1 2

Exemptions
3 4 5 Over 5 1 2

Exemptions
3
4

Exemptions
5 Over 5 1 2 3 4 5 Over 5 1 2

Exemptions
3 4 5 Over 5 1 2

Exemptions
3 4
3

4

5

Over 5

Nevada2
238 401 487 563 632 695 756 813 867 938 1038 1126 1214 1295 270 453 550 635 290 487 591 682

6.5000% New Jersey
306 513 622 717 319 535 648 747 337 564 683 787 239 410 502 581 654 721 786 846 903 979 1085 1178 1272 1357 266 455 555 643 283 484 590 683

7.0000% New Mexico
296 505 616 714 306 523 638 738 321 547 667 772 221 370 448 516 577 634 688 738 785 249 415 503 578 647 710 770 826 879 266 445 538 619 692 760 823 883 940

5.0000% New York
280 467 564 649 291 485 586 674 306 510 616 708 140 239 292 338 380 419 456 490 523 567 628 682 736 785 156 265 324 375 421 464 505 543 579 627 694 754 813 867 166 282 344 398 447 493 536 577 615 666 737 800 863 920

4.0000% North Carolina
173 295 360 416 467 515 560 602 642 696 770 835 900 960 180 306 372 431 484 533 579 623 664 188 320 390 451 506 557 606 651 695 197 319 382 436 485 530 573 612 650 230 372 445 508 564 616 665 710 753 253 408 487 556 617 673 727 776 823

4.3128%
285 458 547 623 692 755 814 869 921 990 1084 1167 1250 1324 305 490 585 666 739 806 869 928 983 1057 1157 1245 1333 1412

$0 $20,000 20,000 30,000 30,000 40,000 40,000 50,000 50,000 60,000 60,000 70,000 70,000 80,000 80,000 90,000 90,000 100,000 100,000 120,000 140,000 160,000 180,000 120,000 140,000 160,000 180,000 200,000

270 435 520 593 658 718 774 827 877 942 1033 1112 1190 1262

712 764 804 836 881 783 840 883 919 968 850 912 959 997 1051 914 980 1030 1071 1128 974 1044 1097 1141 1201 1054 1165 1262 1361 1450 1129 1247 1352 1456 1552 1187 1311 1420 1529 1629 1234 1362 1475 1589 1692 1299 1433 1552 1671 1779

724 768 802 830 867 798 847 884 914 955 868 922 962 995 1039 934 992 1035 1070 1118 998 1058 1104 1142 1193 1081 1197 1300 1403 1497 1147 1270 1378 1487 1586 1197 1325 1438 1551 1654 1237 1369 1486 1603 1709

726 754 792 797 827 869 864 896 942 926 961 1009 986 1023 1074 1064 1173 1268 1363 1450 1104 1217 1316 1414 1504 1159 1277 1381 1485 1579

1292 848 950 1015 1430 936 1047 1118 1552 1012 1132 1210 1674 1089 1218 1301 1785 1159 1295 1383

719 752 796 832 863 902 931 973 992 1037

699 810 885 768 889 970 827 957 1044 887 1026 1119 941 1088 1186

200,000 or more

1704 1904 2035 2134 2216 2328 1792 1973 2090 2178 2250 2348 1510 1686 1800 1886 1956 2052 1034 1141 1210 1262 1304 1362 1213 1398 1522 1618 1697 1808

Income
$0 $20,000 20,000 30,000 30,000 40,000 40,000 50,000 50,000 60,000 60,000 70,000 70,000 80,000 80,000 90,000 90,000 100,000 100,000 120,000 140,000 160,000 180,000 120,000 140,000 160,000 180,000 200,000

North Dakota 5.0000% Ohio
180 305 372 430 483 531 578 622 663 207 348 423 489 548 603 655 704 751 224 377 458 528 592 651 707 760 810 238 400 485 559 627 689 748 803 856 925 1022 1107 1192 1270 250 419 507 585 655 720 781 839 893 966 1066 1155 1244 1324 266 445 539 621 695 763 828 889 946 214 363 442 511 573 631 686 738 787 242 409 497 574 643 708 769 826 881 260 438 532 614 689 758 823 884 943

5.5000% Oklahoma
273 460 559 645 284 479 581 671 299 504 612 705 225 360 430 490 544 594 641 685 726 269 428 510 580 643 700 755 805 853 916 1003 1079 1155 1224 299 475 565 642

4.5000% Pennsylvania
323 512 608 691 343 543 645 732 372 587 696 790 195 331 403 466 523 576 626 673 718 219 371 451 520 584 642 698 750 800 235 397 482 556 624 686 745 801 854 924 1021 1106 1192 1270

6.0000% Rhode Island
257 432 525 606 679 747 811 871 928 1004 1109 1201 1294 1378 270 455 552 637 713 784 851 914 974 230 376 452 518 577 632 683 731 777 259 423 507 580 646 706 763 816 867 279 453 543 621 691 755 816 872 926 997 1094 1180 1265 1343

7.0000%
305 495 593 677 322 522 624 712

247 416 506 584 654 719 781 839 895 968 1069 1158 1248 1329

293 476 570 652

724 752 791 796 826 869 864 898 944 928 964 1013 989 1027 1080 1070 1182 1281 1380 1470 1111 1227 1330 1432 1526

711 765 810 874 774 832 881 950 834 896 948 1022 889 955 1010 1088 941 1011 1069 1151 1010 1105 1188 1271 1345 1084 1185 1274 1362 1441 1146 1253 1346 1438 1522

725 753 792 792 823 865 856 888 934 915 950 998 971 1008 1059 1045 1147 1236 1325 1406 1084 1190 1282 1374 1458 1139 1249 1346 1442 1530

719 813 876 795 898 968 863 974 1049 931 1050 1130 993 1119 1204

1023 852 954 1020 1129 942 1054 1127 1222 1021 1143 1221 1316 1101 1231 1316 1400 1174 1312 1402

1168 781 1290 856 1397 922 1504 988 1602 1048

1234 777 866 1348 859 957 1448 932 1037 1547 1005 1118 1636 1071 1191

1054 837 934 1163 920 1026 1260 994 1106 1357 1067 1187 1445 1133 1260

200,000 or more

1309 1470 1579 1663 1733 1830 1542 1721 1838 1926 1998 2097 1349 1568 1719 1839 1939 2081 1408 1563 1664 1741 1804 1890 1466 1627 1732 1811 1877 1967

Income
$0 $20,000 20,000 30,000 30,000 40,000 40,000 50,000 50,000 60,000 60,000 70,000 70,000 80,000 80,000 90,000 90,000 100,000 100,000 120,000 140,000 160,000 180,000

South Carolina
227 385 468 541 608 669 727 782 834 256 433 527 609 275 465 566 653

6.0000% South Dakota 4.0000% Tennessee
289 489 595 687 301 509 619 714 318 536 651 752 223 353 419 476 526 573 616 657 695 266 420 497 564 623 678 729 776 821 295 465 551 624 689 749 805 857 906 318 501 592 671 337 530 627 710 365 572 676 765 353 567 677 772 417 667 795 905 1005 1095 1180 1260 1335 1434 1570 1690 1809 1917

7.0000% Texas
246 417 507 586 281 476 578 668 304 515 625 722

6.2500% Utah
322 544 661 763 337 569 691 797 357 603 732 844 224 363 434 496 552 603 651 696 739 263 424 507 578 642 701 756 808 857 289 465 555 633 703 767 827 883 936 1007 1103 1188 1272 1349

4.6500%
309 497 593 675 326 523 624 711 349 560 667 760

460 494 522 562 735 788 832 894 875 938 989 1062 996 1066 1125 1207 1104 1203 1296 1383 1465 1573 1721 1851 1981 2098 1182 1287 1386 1478 1566 1681 1839 1977 2115 2239 1246 1357 1461 1558 1650 1770 1936 2081 2226 2356 1336 1455 1566 1669 1767 1896 2073 2228 2382 2521

684 733 771 801 843 752 806 848 881 927 818 876 921 957 1007 879 942 989 1028 1082 937 1004 1055 1096 1153 1141 1261 1367 1472 1569 1186 1310 1420 1529 1629 1247 1378 1493 1608 1713

741 784 845 857 805 851 917 935 865 915 985 1009 920 973 1048 1078 973 1029 1107 1143 1101 1201 1288 1374 1452 1185 1292 1385 1477 1561 1229 1347 1451 1554 1648

657 749 809 856 894 946 723 824 890 941 982 1040 786 895 967 1022 1067 1129 844 961 1038 1097 1146 1213 900 1025 1107 1169 1221 1292 974 1077 1167 1258 1340 1109 1225 1327 1430 1523 1197 1322 1432 1543 1643 1265 1397 1513 1629 1735 1320 1458 1579 1700 1810

750 789 843 818 860 919 882 927 991 941 990 1057 998 1049 1120 1073 1175 1265 1354 1435 1127 1234 1328 1422 1507 1203 1318 1417 1517 1607

120,000 903 1014 1086 140,000 999 1121 1201 160,000 1083 1215 1301 180,000 1168 1310 1402 200,000 1245 1396 1494 200,000 or more 1636 1832 1959

745 879 971 1042 814 960 1059 1137 874 1030 1136 1219 934 1100 1213 1301 988 1163 1282 1375

1397 795 922 1542 873 1011 1670 941 1089 1798 1009 1167 1915 1071 1237

2056 2134 2243 1258 1477 1625 1741 1837 1973 2118 2456 2684 2861 3008 3214 1756 1994 2150 2269 2367 2502 1381 1591 1731 1841 1931 2057

Income
$0 $20,000 20,000 30,000 30,000 40,000 40,000 50,000 50,000 60,000 60,000 70,000 70,000 80,000 80,000 90,000 90,000 100,000 100,000 120,000 140,000 160,000 180,000 120,000 140,000 160,000 180,000 200,000

Vermont
141 237 288 333 373 410 446 479 510 552 610 661 713 759 156 262 317 366 410 450 489 525 559 605 668 723 779 830 166 278 336 387 434 476 517 555 591 639 705 764 822 875

6.0000% Virginia
173 290 351 404 452 496 538 578 615 665 734 794 855 910 179 299 362 417 467 512 556 596 635 686 757 819 882 938 188 313 378 435 487 535 580 622 662 715 789 853 918 977 158 255 305 348 387 423 456 488 518 558 613 661 709 753 187 299 357 407 452 493 531 568 602 647 710 765 820 870 206 329 392 447 495 540 582 622 659

4.0000% Washington
222 353 420 478 530 577 622 664 703 234 372 443 504 558 608 655 699 740 252 400 475 540 598 651 701 748 792 254 431 525 606 288 487 593 684 310 524 637 736

6.5000% West Virginia
327 552 671 774 341 575 699 806 360 607 737 850 289 470 563 643 338 546 653 746 370 597 714 815

6.0000% Wisconsin
416 670 800 912 1012 1104 1191 1272 1349 1450 1588 1710 1831 1941 445 716 854 973 1080 1178 1271 1356 1438 203 343 417 482 540 594 645 693 739 229 387 470 542 608 668 726 779 830 246 415 504 582 652 716 778 835 890 962 1062 1150 1238 1318

5.0000%
259 437 530 611 685 753 817 878 935 1011 1116 1208 1300 1384 270 454 551 636 284 479 580 669

395 637 761 868 964 1052 1135 1212 1285 1381 1514 1630 1746 1851

681 768 825 868 904 953 750 845 907 955 994 1048 815 918 986 1037 1079 1138 876 987 1059 1114 1159 1222 934 1052 1129 1188 1236 1302 1012 1119 1214 1309 1395 1139 1259 1365 1471 1567 1222 1350 1463 1577 1680 1285 1420 1538 1657 1765 1337 1476 1600 1723 1835 1408 1555 1684 1814 1932

716 829 905 782 905 988 845 978 1066 904 1045 1139 959 1108 1208 1033 1134 1223 1312 1392 1192 1308 1409 1511 1602 1299 1424 1534 1644 1743

712 750 783 824 850 894 912 960 972 1022 1050 1159 1255 1351 1438 1105 1219 1320 1421 1512

708 756 795 850 776 827 870 930 836 890 936 1000 895 953 1002 1070 949 1010 1062 1133

1545 799 898 1692 883 991 1821 956 1074 1950 1030 1156 2066 1097 1231

200,000 or more

996 1086 1145 1189 1225 1275

974 1120 1219 1296 1360 1450 1834 2057 2202 2313 2404 2529 1797 2062 2239 2376 2490 2648 1436 1610 1723 1809 1878 1974

Income
$0 $20,000 20,000 30,000 30,000 40,000 40,000 50,000 50,000 60,000 60,000 70,000 70,000 80,000 80,000 90,000 90,000 100,000 100,000 120,000 140,000 160,000 180,000 120,000 140,000 160,000 180,000 200,000

Wyoming
152 259 316 366 412 454 494 531 567 614 680 738 797 850 172 293 357 413 464 511 556 597 637 185 315 383 443 498 548 596 641 683

4.0000%
195 331 403 466 524 576 627 674 719 203 345 420 485 545 600 652 701 747 215 364 443 511 574 632 687 738 787
1 2

Note. Alaska does not have a state sales tax. Alaska residents should follow the instructions on the next page to determine their local sales tax amount.
The California table includes the 1% uniform local sales tax rate in additon to the 6.25% state sales tax rate. The Nevada table includes the 2.25% uniform local sales tax rate in addition to the 4.25% state sales tax rate. 3 The rates for Indiana, Iowa, Maryland, and North Carolina increased during 2008, so the rate given is averaged over the year. 4 Residents of Salem County should deduct only half of the amount in the state table.

690 740 778 809 852 764 819 861 895 942 829 888 933 970 1021 894 958 1006 1046 1100 953 1021 1073 1115 1173

200,000 or more

1120 1255 1342 1409 1464 1539

A-12

Which Optional Local Sales Tax Table Should I Use?
IF you live in the state of... Alaska Arizona Arkansas California Colorado AND you live in... Any locality Glendale, Mesa, Phoenix, or Tucson Chandler, Gilbert, Peoria, Scottsdale, Tempe, Yuma, or any other locality Any locality Los Angeles County Aurora, Fort Collins, Greeley, Jefferson County, Lakewood, or Longmont Arvada, City of Boulder, Thornton, or Westminster Adams County, Arapahoe County, Boulder County, Centennial, Colorado Springs, Denver City/Denver County, El Paso County, Larimer County, City of Pueblo, Pueblo County, or any other locality Georgia Illinois Louisiana Any locality Any locality Any other locality Ascension Parish, Bossier Parish, Caddo Parish, Calcasieu Parish, East Baton Rouge Parish, Iberia Parish, Jefferson Parish, Lafayette Parish, Lafourche Parish, Livingston Parish, Orleans Parish, Ouachita Parish, Rapides Parish, St. Bernard Parish, St. Landry Parish, St. Tammany Parish, Tanqipahoa Parish, or Terrebonne Parish Missouri New York Saint Charles County or Saint Louis County Saint Louis City or any other locality New York City, or one of the following counties: Albany, Allegany, Cattaraugus, Cayuga, Chemung, Clinton, Cortland, Erie, Essex, Franklin, Fulton, Genesee, Herkimer, Jefferson, Lewis, Livingston, Monroe, Montgomery, Nassau, Niagara, Oneida, Onondaga, Ontario, Orange, Orleans, Oswego, Otsego, Putnam, Rensselaer, Rockland, St. Lawrence, Saratoga, Schenectady, Schoharie, Seneca, Steuben, Suffolk, Sullivan, Tompkins, Ulster, Warren, Washington, Westchester, Wyoming, or Yates Any other locality Any locality Cherokee, Chesterfield, Darlington, Jasper, Lee, or Lexington Any other locality Any locality Any locality Any locality THEN use Local Table... C A C B A B C A B A B C

A B A

North Carolina South Carolina Tennessee Utah Virginia

D A A B B A B

2008 Optional Local Sales Tax Tables for Certain Local Jurisdictions
(Based on a local sales tax rate of 1 percent)
Income At least $0 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000 120,000 140,000 160,000 180,000 But less than $20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000 120,000 140,000 160,000 180,000 200,000

Local Table A
Exemptions
1 2 3 4 5 Over 5 1

Local Table B
Exemptions
2 3 4 5 Over 5 1

Local Table C
Exemptions
2 3 4 5 Over 5 1

Local Table D
Exemptions
2 3 4 5 Over 5

37 60 72 83 92 101 109 117 125 135 148 160 172 183

42 46 49 52 55 48 57 64 69 74 80 54 65 72 77 82 89 69 75 80 84 90 75 89 99 107 114 123 85 101 112 121 128 138 83 90 96 101 107 88 105 117 126 134 145 101 120 132 142 151 162 95 103 110 115 122 100 119 132 143 151 164 114 135 150 161 170 183 106 116 126 134 143 154 169 183 196 209 115 126 136 146 155 167 183 198 212 226 122 134 144 155 164 177 194 210 225 239 128 140 151 162 172 185 203 219 235 250 136 149 161 172 182 196 216 233 249 265 111 120 129 138 146 156 170 183 196 207 132 143 153 163 172 185 201 216 230 244 146 158 170 181 191 204 222 238 254 269 157 170 183 194 205 220 239 256 273 288 167 181 194 206 217 232 253 271 289 305 180 195 209 222 235 251 273 292 311 328 127 138 148 158 167 179 195 210 224 237 150 163 175 186 197 211 230 246 263 278 165 179 193 205 217 232 253 271 290 306 178 193 207 220 233 249 271 291 310 328 188 204 219 233 246 263 286 307 327 346 202 219 235 250 264 283 308 330 352 371

35 60 73 85 95 105 114 123 131 142 157 171 184 196

39 66 81 94 105 116 126 136 145 157 174 189 203 217

42 43 45 47 71 74 77 80 86 90 93 98 100 104 108 113 112 123 134 144 154 167 184 200 216 230 117 129 140 151 161 174 193 209 225 240 121 133 145 156 166 180 199 216 233 248 127 139 152 163 174 188 208 226 243 259

200,000 or more

239 271 292 309 323 342 264 309 340 365 385 414 302 353 388 415 437 469 259 285 303 316 326 341

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Instructions for Schedule B, Interest and Ordinary Dividends
You can list more than one payer on each entry space for lines 1 and 5, but be sure to clearly show the amount paid next to the payer's name. Add the separate amounts paid by the payers listed on an entry space and enter the total in the "Amount" column. If you still need more space, attach separate statements that are the same size as the printed schedule. Use the same format as lines 1 and 5, but show your totals on Schedule B. Be sure to put your name and social security number (SSN) on the statements and attach them at the end of your return.

Use Schedule B (Form 1040) if any of the following applies. You had over $1,500 of taxable interest. Any of the Special Rules listed in the instructions for line 1 apply to you. You are claiming the exclusion of interest from series EE or I U.S. savings bonds issued after 1989. You had over $1,500 of ordinary dividends. You received ordinary dividends as a nominee. You had a foreign account or you received a distribution from, or were a grantor of, or transferor to, a foreign trust. Part III of the schedule has questions about foreign accounts and trusts.

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total on line 1. Do this even if you later distributed some or all of this income to others. Under your last entry on line 1, put a subtotal of all interest listed on line 1. Below this subtotal, enter "Nominee Distribution" and show the total interest you received as a nominee. Subtract this amount from the subtotal and enter the result on line 2.

you paid qualified higher education expenses for yourself, your spouse, or your dependents, you may be able to exclude part or all of the interest on those bonds. See Form 8815 for details.

Part I. Interest
Line 1
Interest
Report on line 1 all of your taxable interest. Taxable interest should be shown on your Forms 1099-INT, Forms 1099-OID, or substitute statements. Include interest from series EE, H, HH, and I U.S. savings bonds. List each payer's name and show the amount. Do not report on this line any tax-exempt interest from box 8 or box 9 of Form 1099-INT. Instead, report the amount from box 8 on line 8b of Form 1040. If an amount is shown in box 9 of Form 1099-INT, you generally must report it on line 12 of Form 6251. See the instructions for Form 6251 for more details.

If you received interest as a nominee, you must give the actual owner a Form 1099-INT unless the owner is your spouse. You must also file a Form 1096 and a Form 1099-INT with the IRS. For more details, see the General Instructions for Forms 1099, 1098, 5498, and W-2G and the Instructions for Forms 1099-INT and 1099-OID.

Part II. Ordinary Dividends
You may have to file Form 5471 if, in 2008, you were an officer or director of a foreign corporation. You may also have to file Form 5471 if, in 2008, you owned 10% or more of the total (a) value of a foreign corporation's stock, or (b) combined voting power of all classes of a foreign corporation's stock with voting rights. For details, see Form 5471 and its instructions.

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Accrued Interest When you buy bonds between interest payment dates and pay accrued interest to the seller, this interest is taxable to the seller. If you received a Form 1099 for interest as a purchaser of a bond with accrued interest, follow the rules earlier under Nominees to see how to report the accrued interest on Schedule B. But identify the amount to be subtracted as "Accrued Interest." Original Issue Discount (OID) If you are reporting OID in an amount less than the amount shown on Form 1099-OID, follow the rules earlier under Nominees to see how to report the OID on Schedule B. But identify the amount to be subtracted as "OID Adjustment." Amortizable Bond Premium If you are reducing your interest income on a bond by the amount of amortizable bond premium, follow the rules earlier under Nominees to see how to report the interest on Schedule B. But identify the amount to be subtracted as "ABP Adjustment."

Line 5
Ordinary Dividends
Report on line 5 all of your ordinary dividends. This amount should be shown in box 1a of your Forms 1099-DIV or substitute statements. List each payer's name and show the amount.

Special Rules
Seller-Financed Mortgages
If you sold your home or other property and the buyer used the property as a personal residence, list first any interest the buyer paid you on a mortgage or other form of seller financing. Be sure to show the buyer's name, address, and SSN. You must also let the buyer know your SSN. If you do not show the buyer's name, address, and SSN, or let the buyer know your SSN, you may have to pay a $50 penalty.

Nominees If you received a Form 1099-DIV that includes ordinary dividends you received as a nominee (that is, in your name, but the ordinary dividends actually belong to someone else), report the total on line 5. Do this even if you later distributed some or all of this income to others. Under your last entry on line 5, put a subtotal of all ordinary dividends listed on line 5. Below this subtotal, enter "Nominee Distribution" and show the total ordinary dividends you received as a nominee. Subtract this amount from the subtotal and enter the result on line 6.

Line 3
Excludable Interest on Series EE and I U.S. Savings Bonds Issued After 1989
If, during 2008, you cashed series EE or I U.S. savings bonds issued after 1989 and

Nominees If you received a Form 1099-INT that includes interest you received as a nominee (that is, in your name, but the interest actually belongs to someone else), report the

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If you received dividends as a nominee, you must give the actual owner a Form 1099-DIV unless the owner is your spouse. You must also file a Form 1096 and a Form 1099-DIV with the IRS. For more details, see the General Instructions for Forms 1099, 1098, 5498, and W-2G and the Instructions for Form 1099-DIV.

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Part III. Foreign Accounts and Trusts
Lines 7a and 7b
Foreign Accounts Line 7a
Check the "Yes" box on line 7a if either (1) or (2) below applies. 1. You own more than 50% of the stock in any corporation that owns one or more foreign bank accounts. 2. At any time during 2008 you had an interest in or signature or other authority over a financial account in a foreign country (such as a bank account, securities account, or other financial account).

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For line 7a, item (2) does not apply to foreign securities held in a U.S. securities account.

The accounts were with a U.S. military banking facility operated by a U.S. financial institution. You were an officer or employee of a commercial bank that is supervised by the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, or the Federal Deposit Insurance Corporation; the account was in your employer's name; and you did not have a personal financial interest in the account. You were an officer or employee of a domestic corporation with securities listed on national securities exchanges or with assets of more than $10 million and 500 or more shareholders of record; the account was in your employer's name; you did not have a personal financial interest in the account; and the corporation's chief financial officer has given you written notice that the corporation has filed a current report that includes the account. See Form TD F 90-22.1 to find out if you are considered to have an interest in or signature or other authority over a financial account in a foreign country (such as a bank account, securities account, or other financial account). You can get Form TD F 90-22.1 by visiting the IRS website at www.irs.gov/pub/irs-pdf/f90221.pdf. If you checked the "Yes" box on line 7a, file Form TD F 90-22.1 by June 30, 2009, with the Department of the Treasury at the address shown on that form. Do not attach it to Form 1040.
If you are required to file Form TD F 90-22.1 but do not do so, you may have to pay a penalty of up to $10,000 (more in some cases).

Line 7b
If you checked the "Yes" box on line 7a, enter the name of the foreign country or countries in the space provided on line 7b. Attach a separate statement if you need more space.

Line 8
Foreign Trusts
If you received a distribution from a foreign trust, you must provide additional information. For this purpose, a loan of cash or marketable securities generally is considered to be a distribution. See Form 3520 for details. If you were the grantor of, or transferor to, a foreign trust that existed during 2008, you may have to file Form 3520. Do not attach Form 3520 to Form 1040. Instead, file it at the address shown in its instructions. If you were treated as the owner of a foreign trust under the grantor trust rules, you are also responsible for ensuring that the foreign trust files Form 3520-A. Form 3520-A is due on March 16, 2009, for a calendar year trust. See the instructions for Form 3520-A for more details.

Exceptions. Check the "No" box if any of

the following applies to you. The combined value of the accounts was $10,000 or less during the whole year.

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