value of the property as a result of the casualty, or (2) your adjusted basis in the property. This amount must be further reduced by any insurance or other recovery, and, in the case of property held for personal use, by the $100 limitation. Report your casualty or theft loss on Schedule A. If more than one item was involved in a single casualty or theft, or if you had more than one casualty or theft during the year, use Form 4684 for computing your personal casualty loss. MISCELLANEOUS Appraisal fees to determine the amount of a casualty loss or to determine the fair market value of charitable contributions. Union dues. Cost of preparation of income tax return. Cost of tools for employee (depreciated over the useful life of the tools). Dues for Chamber of Commerce (if as a business expense). Rental cost of a safe-deposit box used to store taxable income-producing property records. Fees paid to investment counselors (if the fees relate to investments that produce taxable income.) Subscriptions to business publications. Telephone and postage in connection with investments. Uniforms required for employment and not generally wearable off the job. Maintenance of uniforms required for employment. Special safety apparel (e.g., steel toe safety shoes or helmets worn by construction workers; special masks worn by welders). Business entertainment expenses. Business gift expenses not exceeding $25 per recipient. Employment agency fees under certain circumstances. Cost of a periodic physical examination if required by employer to keep your job or in order to get the job. Cost of bond if required for employment. Expenses of an office in your home if used regularly and exclusively for business purposes. Educational expenses that are: (1) required by your employer to maintain your position; or (2) for maintaining or sharpening your skills for your employment. POLITICAL CAMPAIGN CONTRIBUTIONS You may claim a credit (line 38, Form 1040, or line 12a, Form 1040A) for campaign contributions to an individual who is a candidate for nomination or election to any Federal, State, or local office in any primary, general, or special election. The credit is also applicable for any (1) committee supporting a candidate for Federal, State, or local elective public office, (2) national committee of a national political party, (3) State committee of a national political party, (4) local committee of a national political party, or (5) certain newsletter funds set up and maintained by a person who holds, has been elected to, or is a candidate for nomination or election to a public office. The amount of the tax credit is one-half of the political contribution, with a $50 ceiling ($100 for couples filing a joint return). PRESIDENTIAL ELECTION CAMPAIGN FUND Additionally, you may voluntarily earmark $1 of your taxes ($2 on joint returns) for the Presidential Election Campaign Fund. OTHER TAX RELIEF MEASURES Required to file a tax return if gross income is at least $3,300 4,300 Filing status Single (under age 65) - Qualifying widow(er) under 65 with dependent child. 4,400 5, 400 5, 400 6, 400 7,400 1,000 Additional Exemption for Age.-Besides the regular $1,000 exemption, you are allowed an additional exemption of $1,000 if you are age 65 or older on the last day of the taxable year. If both a husband and wife are 65 or older on the last day of the taxable year, each is entitled to an additional exemption of $1,000 because of age. You are considered 65 on the day before your 65th birthday. Thus, if your 65th birthday is on January 1, 1981, you will be entitled to the additional $1,000 exemption because of age for your 1980 Federal in "Zero Bracket Amount."-The "zero bracket amount" is a it amount that depends on your filing status. If you are arried filing jointly or a qualifying widow or widower, your ro bracket amount is $3,400. If you are single or a head of Dusehold, your zero bracket amount is $2,300. If you are carried filing separately, it is $1,700. It is not a separate eduction; instead, the equivalent amount is built into the x tables and tax rate schedules. Since this amount is built to the tax tables and tax rate schedules, you will need to ake an adjustment if you itemize deductions. However, emizers will not experience any change in their tax liability nd the tax computation will be simplified for many itemizers. Tax Tables.-Tax tables have been developed to make easier for you to find your tax if your income is under ertain levels. Even if you itemize deductions, you may e able to use the tax tables to find your tax easier. In ddition, you do not have to deduct $1,000 for each exempon because this amount is also built into the tax table or you. Multiple Support Agreements.-In general, a person may e claimed as a dependent of another taxpayer, provided ve tests are met: (1) support, (2) gross income, (3) memer of household or relationship, (4) citizenship, and (5) eparate return. But in some cases, two or more individuals rovide support for an individual, and no one has conributed more than half the person's support. However, t still may be possible for one of the individuals to be ntitled to a $1,000 dependency deduction if the followng requirements are met for multiple support: 1. Two or more persons-any one of whom could claim he person as a dependent if it were not for the support est-together contribute more than half of the dependent's support. 2. Any one of those who individually contribute more than 10% of the mutual dependent's support, but only one of them, may claim the dependency deduction. 3. Each of the others must file a written statement that he will not claim the dependency deduction for that year. The statement must be filed with the income tax return of the person who claims the dependency deduction. Form 2120 (Multiple Support Declaration) may be used for this Sale of Personal Residence.-You may exclude from your gross income some or all of your gain from the sale or exchange of your principal residence, if you meet certain age, ownership, and occupancy requirements at the time of the sale or exchange. The exclusion is elective, and you may elect to exclude gain only once for sales or exchanges after July 26, 1978. If you were age 55 or older before the date of sale or exchange, you may elect to exclude up to $100,000 of gain on the sale or exchange if you owned and occupied the residence for 3 of the 5 years ending on the date of sale (or 5 of 8 years if you were 65 or older on the date of the sale or exchange. This applies only to a sale or exchange before July 26, 1981). Form 2119 (Sale or Exchange of Principal Residence) is helpful in determining what gain, if any, may be excluded. Additionally, payment of tax on the gain on the sale or exchange of your personal residence in excess of the excluded amount will be deferred if, within 18 months before or 18 months after the sale or exchange, you buy and occup another residence, the cost of which equals or exceeds the adjusted sales price of the old residence. Additional time is allowed if (1) you construct the new residence; (2) you were on active duty in the U.S. Armed Forces; or (3) your tax home was abroad. Publication 523 (Tax Information on Selling Your Home) may also be helpful. Credit for the Elderly.-You may be able to claim this credit and reduce taxes by as much as $375 (if single). or $562.50 (if married filing jointly), if you are: (1) Age 65 or older, or (2) Under age 65 and retired under a public retirement system. For more information, see instructions for Schedules R and RP. Credit for Child and Dependent Care Expenses. Certain payments made for child and dependent care may be claimed as a credit against tax. If you maintained a household that included your dependent under age 15 or a dependent or spouse incapable of self-care, you may be allowed a 20% credit for employment related expenses. These expenses must have been paid during the taxable year in order to enable you to work either full or part time. For detailed information, see the instructions in Form Earned Income Credit.-If you have a dependent child o shares your principal place of abode in the United Fates, you may be entitled to a special payment or credit up to $500. This is called the earned income credit. It ay come as a refund check or be applied against any Exes owed. Generally, if you reported earned income and ad adjusted gross income (line 31, Form 1040) of less than 0,000, you may be able to claim the credit. Earned income means wages, salaries, tips, strike beneEs, other employee compensation, disability pensions, and et earnings from self-employment (generally amount shown 1 Schedule SE (Form 1040) line 13). A married couple must e a joint return to be eligible for the credit. Certain married ersons living apart with a dependent child may also be igible to claim the credit. For more information, see instructions for Form 1040 or 040A. RESIDENTIAL ENERGY CREDIT The law provides certain tax incentives to encourage nergy conservation and conversion to renewable energy ources. A credit of up to $300 may be claimed for expenditures or energy conservation property installed in or on your rincipal residence, whether you own or rent it. The residence must have been substantially completed by April 20, 1977. tems eligible for the credit are limited to the following: sulation (fiberglass, cellulose, etc.) for ceilings, walls, oors, roofs, water heaters, etc.; exterior storm (or thermal) windows or doors; caulking or weatherstripping for exterior vindows or doors; a furnace replacement burner which educes the amount of fuel used; a device to make flue penings (for a heating system) more efficient; an electrical or mechanical furnace ignition system which replaces a gas ›ilot light; an automatic energy-saving setback thermostat; and a meter which displays the cost of energy usage. For years beginning after 1979, the maximum credit for renewable energy source property is $4,000. Equipment used in the production or distribution of heat or electricity from solar, geothermal, or wind energy sources for residential heating, cooling, or other purposes may qualify for this credit. Energy credits may be claimed by completing Form 5695 |