US Internal Revenue Service: i1040nr--1997

8/14/2019 US Internal Revenue Service: i1040nr--1997

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1997 Department of the TreasuryInternal Revenue ServiceInstructions for Form1040NRU.S. Nonresident Alien Income Tax ReturnSection references are to the Internal Revenue Code unless otherwise noted.

General InstructionsTip: For details on these and otherchanges, see Pub. 553 or What's Hot atwww.irs.ustreas.gov.

What's New for 1997?

Capital Gains Tax Rates

The tax rates have been lowered for mostcapital gains realized after May 6, 1997.Use new Part IV of Schedule D (Form

1040) to figure your tax if you have a netcapital gain. See the instructions forSchedule D (Form 1040) for more details.Capital Gain Distributions. You mustnow report your capital gain distributionson Schedule D (Form 1040), even if youdo not have any other capital gains orlosses.

Taxpayer Identification Numbers(TINs)

You must include on your return thecorrect TIN of each person you claim asaq Dependent on Form 1040NR (note thatresidents of Canada, Mexico, Japan, andthe Republic of Korea and U.S. nationals(American Samoans) are generally theonly filers that are allowed to claim adependent on Form 1040NR).q Qualifying person for the child anddependent care credit on Form 2441.

If you do not, at the time we processyour return, we may disallow that personas a dependent and reduce or disallowany other tax benefits (such as the childand dependent care credit) based on thatperson. To find out how to get an TIN, seeIdentifying Number on page 6.

Generally, an individual's TIN is his orher social security number (SSN). If the

person does not have and cannot get anSSN, enter that person's individualtaxpayer identification number (ITIN) oradoption taxpayer identification number(ATIN). See Identifying Number on page6 for details on ITINs and see Form W-7Afor details on ATINs.

Adoption Expenses

If you paid qualified adoption expenses in1997 and the adoption was final in orbefore 1997, you may be able to take acredit of up to $5,000 ($6,000 for a childwith special needs). See Form 8839 for

details. If you received employer-providedadoption benefits in 1997, you must useForm 8839 to figure the amount ofbenefits you may exclude from yourincome.

Penalty-Free IRA Distributions

The additional tax on an early distributionfrom an IRA may not apply if you paidmedical expenses in 1997. See Form5329 for details.

Self-Employed Health Insurance

You may be able to deduct up to 40% ofyour health insurance. See theinstructions for line 27 on page 10 fordetails.

Medical Savings Accounts (MSAs)

If you or your employer madecontributions to your MSA for 1997, youmust file Form 8853. If you made thecontributions, you may be able to take adeduction on Form 1040NR, line 25.

Long-Term Care Insurance

Qualified long-term care insurancepremiums and the unreimbursed

expenses for the care of a chronically illindividual may be deductible as medicalexpenses. See Pub. 502 for details. If youreceived benefits under a long-term careinsurance contract, see Form 8853.

Accelerated Death Benefits

See Form 8853 if you receivedaccelerated death benefits under a lifeinsurance contract or from a viaticalsettlement provider. Generally, a viaticalsettlement is an arrangement that letsterminally ill individuals sell their lifeinsurance policies.

Business Standard Mileage Rate

The rate for business use of a vehicle hasincreased to 31.5 cents a mile.

What To Look for in 1998Child Tax Credit. U.S. nationals may beable to take a $400 credit for each of theirdependent children under age 17.Student Loan Interest. You may be ableto deduct up to $1,000 of the interest youpay on a loan for qualified educationexpenses for yourself or your dependents(note that residents of Canada, Mexico,Japan, and the Republic of Korea and

U.S. nationals are generally the only filersthat are allowed to claim a dependent onForm 1040NR). The deduction is allowedin figuring adjusted gross income. But youcannot take the deduction if you can beclaimed as a dependent on someoneelse's 1998 tax return.Education IRAs. You may be able tocontribute up to $500 each year to anEducation IRA for a person under age 18.The contributions are not deductible.IRA Deduction Restored for Some

People Covered By Retirement Plans.You may be able to take an IRA deductionif you are covered by a retirement planand your 1998 modified adjusted grossincome is less than $40,000 if not married(currently filing status box 1 or 2); or$60,000 if a qualifying widow(er)(currently filing status box 6).Roth IRAs. You may be able tocontribute up to $2,000 to a Roth IRA.Although the contributions are notdeductible, the earnings may be tax freedepending on when and why withdrawalsare made.Penalty-Free IRA Distributions. Theadditional tax on an early distribution from

an IRA may not apply if you pay highereducation expenses for yourself, yourspouse, or your children or grandchildren.The tax also may not apply if you payexpenses related to the purchase of ahome by a first-time homebuyer.Estimated Tax Penalty. You generallywill not owe an estimated tax penalty ifyour 1998 tax return shows a balance duethe IRS of less than $1,000.Self-Employed Health Insurance. Youmay be able to deduct up to 45% of yourhealth insurance.

Items To Note

Form 1040NR-EZ. You may be able touse Form 1040NR-EZ, U.S. Income TaxReturn for Certain Nonresident AliensWith No Dependents, if your only incomefrom U.S. sources is wages, salaries, tips,taxable refunds of state and local incometaxes, and scholarship or fellowshipgrants. Also, if married, you cannot claiman exemption for your spouse. For moredetails, see Form 1040NR-EZ and itsinstructions.Other Reporting Requirements. If youmeet the closer connection to a foreigncountry exception to the substantial

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presence test or exclude days ofpresence in the United States forpurposes of that test, you must file astatement containing certain information.This rule does not apply toforeign-government-related individualswho exclude days of presence in theUnited States. For details, see Form8840, Closer Connection ExceptionStatement for Aliens, or Form 8843,Statement for Exempt Individuals andIndividuals With a Medical Condition.

Certain dual-resident taxpayers who claimtax treaty benefits must file Form 8833,Treaty-Based Return Position DisclosureUnder Section 6114 or 7701(b). Adual-resident taxpayer is one who is aresident of both the United States andanother country under each country's taxlaws.

Additional InformationIf you need more information, our freepublications may help you. Pub. 519, U.S.Tax Guide for Aliens, will be the mostimportant, but the following publicationsmay also help.

Pub. 525, Taxable and NontaxableIncomePub. 529, Miscellaneous DeductionsPub. 552, Recordkeeping for IndividualsPub. 597, Information on the UnitedStates-Canada Income Tax TreatyPub. 901, U.S. Tax TreatiesPub. 910, Guide to Free Tax Services(includes a list of all publications)

These free publications and the formsand schedules you will need are availableon request from the Internal RevenueService. If you have a foreign address,send your order to either: Eastern AreaDistribution Center, P.O. Box 25866,Richmond, VA 23286-8107, U.S.A.; orWestern Area Distribution Center, RanchoCordova, CA 95743-0001, U.S.A.,whichever is closer.

Resident Alien orNonresident AlienIf you are not a citizen of the UnitedStates, specific rules apply to determineif you are a resident alien or a nonresidentalien for tax purposes. Generally, you areconsidered a resident alien if you meeteither the green card test or thesubstantial presence test for 1997. Ifyou do not meet either of these tests for1997 but you meet the substantialpresence test for 1998, you may be ableto choose to be treated as a resident alienfor part of 1997. But you must have beenphysically present in the United States forat least 31 days in a row during 1997 todo so. This choice does not apply if youmet either the green card test or thesubstantial presence test for 1996. Formore details, see Pub. 519.

You are considered a nonresident alienfor the year if you are not a U.S. residentunder either of these tests. You are alsoconsidered a nonresident alien if you

otherwise meet the substantial presencetest but you come under any of the threeexceptions described below.

For more details on resident andnonresident status, the tests for residenceand the exceptions to them, see Pub. 519.Green Card Test. You are a resident fortax purposes if you were a lawfulpermanent resident (immigrant) of theUnited States at any time during 1997.Substantial Presence Test. You areconsidered a U.S. resident if you meet thesubstantial presence test for 1997. Youmeet this test if you were physicallypresent in the United States for at least:

1. 31 days during 1997, and2. 183 days during the period 1997,

1996, and 1995, counting all the days ofphysical presence in 1997 but only 1/3 thenumber of days of presence in 1996 andonly 1/6 the number of days in 1995.

Generally, you are treated as presentin the United States on any day that youare physically present in the country atany time during the day.Exceptions. The following areexceptions to the substantial presence

test.1.Exempt individual. You do not

count days for which you are an exemptindividual. In general, an exemptindividual is someone who is a:

a. foreign-government-relatedindividual,

b. teacher or trainee,c. student, ord. professional athlete who is

temporarily in the United States tocompete in a charitable sports event.Note: Alien individuals with Q visas aretreated as either students, teachers, ortrainees and, as such, are exempt

individuals for purposes of the substantialpresence test if they otherwise qualify.Q visas are issued to aliens participatingin certain international cultural exchangeprograms.

2.Medical condition. You do notcount any day that you intended to leavethe United States but were unable toleave because of a medical condition ormedical problem that arose while youwere present in the United States.Note: This exception does not apply topre-existing medical conditions orproblems. For more details, see Pub. 519.

3.Closer connection to foreigncountry. Even though you would

otherwise meet the substantial presencetest, you are not treated as having metthat test for 1997 if you:

a. were present in the United Statesfor fewer than 183 days during 1997,

b. establish that during 1997 you hada tax home in a foreign country, and

c. establish that during 1997 you hada closer connection to one foreign countryin which you had a tax home than to theUnited States unless you had a closerconnection to two foreign countries.

Who Must FileFile Form 1040NR if any of the followingfour conditions applies to you.

1. You were a nonresident alienengaged in a trade or business in theUnited States during 1997. You must fileeven if

a. none of your income came from atrade or business conducted in the UnitedStates,

b. you have no income from U.S.

sources, orc. your income is exempt from U.S.

tax.In any of the above three cases, do not

complete the schedules for Form1040NR. Instead, attach a list of the kindsof exclusions you claim and the amountof each.Note: If you were a nonresident alienstudent, teacher, or trainee who wastemporarily present in the United Statesunder an F, J, M, or Q visa, youmust file Form 1040NR (or Form1040NR-EZ) only if you have income thatis subject to tax under section 871.

2. You were a nonresident alien notengaged in a trade or business in theUnited States during 1997 and not all U.S.tax that you owe was withheld from yourincome.

3. You represent a deceased personwho would have had to file Form 1040NR.

4. You represent an estate or trustthat has to file Form 1040NR.Exception for Children Under Age 14.If your child was under age 14 on January1, 1998, had income only from interestand dividends that are effectivelyconnected with a U.S. trade or business,and that income totaled less than $6,500,you may be able to elect to report your

child's income on your return. But youmust use Form 8814, Parents' ElectionTo Report Child's Interest and Dividends,to do so. If you make this election, yourchild does not have to file a return. Formore details, see Form 8814.Filing a Deceased Person's Return.The personal representative must file thereturn for a deceased person who wasrequired to file a return for 1997. Apersonal representative can be anexecutor, administrator, or anyone who isin charge of the deceased person'sproperty.Filing for an Estate or Trust. If you arefiling Form 1040NR for a nonresidentalien estate or trust, change the form toreflect the provisions of Subchapter J,Chapter 1, of the Internal Revenue Code.You may find it helpful to refer to Form1041, U.S. Income Tax Return for Estatesand Trusts, and its instructions.

When To FileIndividuals. If you were an employeeand received wages subject towithholding, file Form 1040NR by the 15thday of the 4th month after your tax year

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ends. A return for the 1997 calendar yearis due by April 15, 1998.

If you did not receive wages as anemployee subject to U.S. income taxwithholding, file Form 1040NR by the 15thday of the 6th month after your tax yearends. A return for the 1997 calendar yearis due by June 15, 1998.Estates and Trusts. If you file for anonresident alien estate or trust that hasan office in the United States, file thereturn by the 15th day of the 4th month

after the tax year ends. If you file for anonresident alien estate or trust that doesnot have an office in the United States, filethe return by the 15th day of the 6thmonth after the tax year ends.Note: If the regular due date for filing fallson a Saturday, Sunday, or legal holiday,file by the next business day.Extension of Time To File. If you cannotfile your return by the due date, youshould file Form 4868, Application forAutomatic Extension of Time To File U.S.Individual Income Tax Return. You mustfile Form 4868 by the regular due date ofthe return.

Note: Form 4868 does not extend thetime to pay your income tax. The tax isdue by the regular due date of the return.

Where To FileFile Form 1040NR with the InternalRevenue Service Center, Philadelphia,PA 19255, U.S.A.

Election To Be Taxed as aResident AlienYou can elect to be taxed as a U.S.resident for the whole year if all of thefollowing apply to you:q You were married.q Your spouse was a U.S. citizen orresident alien on the last day of the taxyear.q You file a joint return for the year of theelection using Form 1040, 1040A, or1040EZ.

To make this election, you must attachthe statement described in Pub. 519 toyour return. Do not use Form 1040NR.

Your worldwide income for the wholeyear must be included and will be taxedunder U.S. tax laws. You must agree tokeep the records, books, and otherinformation needed to figure the tax. If youmade the election in an earlier year, you

may file a joint return or separate returnfor 1997. If you file a separate return, useForm 1040 or Form 1040A. Yourworldwide income for the whole year mustbe included whether you file a joint orseparate return.Caution: Nonresident aliens who makethis election may forfeit the right to claimbenefits otherwise available under a U.S.tax treaty. For more details, seePub. 901,U.S. Tax Treaties, or refer to the specifictreaty.

Dual-Status TaxpayersNote: If you elect to be taxed as aresident alien (discussed above), thespecial instructions and restrictionsdiscussed heredo notapply.

Dual-Status Tax Year

A dual-status year is one in which youchange status between nonresident andresident alien. Different U.S. income taxrules apply to each status.

Most dual-status years are the yearsof arrival or departure. Before you arrivein the United States, you are anonresident alien. After you arrive, youmay or may not be a resident, dependingon the circumstances.

If you become a U.S. resident, you staya resident until you leave the UnitedStates. You may become a nonresidentalien when you leave, if, after leaving (orafter your last day of lawful permanentresidency if you met the green card test)and for the remainder of the calendar yearof your departure, you have a closerconnection to a foreign country than to theUnited States, and, during the next

calendar year, you are not a U.S.resident under either the green card testor the substantial presence test. See Pub.519.

What and Where To File for aDual-Status Year

If you were a U.S. resident on the lastday of the tax year, file Form 1040, U.S.Individual Income Tax Return. WriteDual-Status Return across the top andattach a statement showing your incomefor the part of the year you were anonresident. You may use Form 1040NRas the statement; write Dual-StatusStatement across the top. File your return

and statement with the Internal RevenueService Center, Philadelphia, PA 19255,U.S.A.

If you were a nonresident on the lastday of the tax year, file Form 1040NR.Write Dual-Status Return across the topand attach a statement showing yourincome for the part of the year you werea U.S. resident. You may use Form 1040as the statement; write Dual-StatusStatement across the top. File your returnand statement with the Internal RevenueService Center, Philadelphia, PA 19255,U.S.A.Statements. Any statement you file withyour return must show your name,address, and identifying number (definedon page 6). You do not have to sign thestatement. Your signature on the return issufficient because it also applies tosupporting statements and schedules.

Former long-term U.S. residents arerequired to file Form 8854, ExpatriationInformation Statement, with theirdual-status return for the last year of U.S.residency. To determine if you are aformer long-term U.S. resident, see page5.

Note: Form 8854 may not be availableat the beginning of 1998. If you make agood faith effort to obtain Form 8854 butare unable to obtain the form, no penaltieswill be assessed if you file a completestatement (in lieu of Form 8854) that setsforth the information contained in SectionIX of Notice 97-19, 1997-1 C.B. 394.

Income Subject to Tax forDual-Status Year

As a dual-status taxpayer not filing a joint

return, you are taxed on income from allsources for the part of the year you werea resident alien. Generally, you are taxedon income only from U.S. sources for thepart of the year you were a nonresidentalien. However, all income effectivelyconnected with the conduct of a trade orbusiness in the United States is taxable.

Income you received as a dual-statustaxpayer from sources outside the UnitedStates while a resident alien is taxable,even if you became a nonresident alienafter receiving it and before the close ofthe tax year. Conversely, income youreceived from sources outside the UnitedStates while a nonresident alien is not

taxable in most cases, even if youbecame a resident alien after receiving itand before the close of the tax year.Income from U.S. sources is taxablewhether you received it while anonresident alien or a resident alien.

Restrictions for Dual-StatusTaxpayers

Standard Deduction. You may not takethe standard deduction.Head of Household. You may not usethe Head of HouseholdTax Table columnor Tax Rate Schedule.Joint Return. You may not file a joint

return. However, see Election To BeTaxed as a Resident Alien above.Tax Rates. If you were married and anonresident of the United States for all orpart of the tax year and you do not makethe election to be taxed as a resident alienas discussed earlier, you must use theTax Table column or Tax Rate Schedulefor Married Filing Separatelyto figure yourtax on income effectively connected witha U.S. trade or business. If married, youmay not use the SingleTax Table columnor Tax Rate Schedule.Deduction for Exemptions. As adual-status taxpayer, you usually will beentitled to your own personal exemption.

Subject to the general rules forqualification, you are allowed exemptionsfor your spouse and dependents infiguring taxable income for the part of theyear you were a resident alien. Theamount you may claim for theseexemptions is limited to your taxableincome (determined without regard toexemptions) for the part of the year youwere a resident alien. You may not useexemptions (other than your own) toreduce taxable income to below zero forthat period.

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Special rules apply for exemptions forthe part of the tax year a dual-statustaxpayer is a nonresident alien if thetaxpayer is a resident of Canada, Mexico,Japan, or the Republic of Korea; a U.S.national; or a student or businessapprentice from India. See Pub. 519.

How To Figure Tax for Dual-StatusYear

When you figure your U.S. tax for adual-status year, you are subject to

different rules for the part of the year youwere a resident and the part of the yearyou were a nonresident.

All income for the period of residenceand all income that is effectivelyconnected with a trade or business in theUnited States for the period ofnonresidence, after allowable deductions,is added and taxed at the same rates thatapply to U.S. citizens and residents.Income that is not effectively connectedwith a trade or business in the UnitedStates for the period of nonresidence issubject to the flat 30% rate or lower treatyrate. No deductions are allowed againstthis income.

If you were a resident alien on the lastday of the tax year, add to the tax fromthe Tax Table, Tax Rate Schedules,Schedule D (Form 1040), or Form 8615the tax on the noneffectively connectedincome. Enter the total tax on Form 1040,line 39. Next to line 39 show the twoamounts. If you are filing Form 1040NR,enter the tax from the Tax Table, TaxRate Schedules, Schedule D (Form1040), or Form 8615 on line 38 and thetax on the noneffectively connectedincome on line 46.Credits. You are allowed a credit againstyour U.S. income tax liability for certaintaxes you paid, are considered to havepaid, or that were withheld from yourincome. These include:

1. Tax withheld from wages earned inthe United States and taxes withheld atthe source from various items of incomefrom U.S. sources other than wages. Thisincludes U.S. tax withheld on dispositionsof U.S. real property interests.

When filing Form 1040, show the totaltax withheld on line 54. Enter amountsfrom the attached statement (Form1040NR, lines 52, 58a, 58b, 59a, and59b) to the left of line 54 and identify andinclude in the amount on line 54.

When filing Form 1040NR, show the

total tax withheld on lines 52, 58a, 58b,59a, and 59b. Enter the amount from theattached statement (Form 1040, line 54)to the left of line 52 and identify andinclude in the amount on line 52.

2. Tax paid with Form 1040-ES,Estimated Tax for Individuals, or Form1040-ES (NR), U.S. Estimated Tax forNonresident Alien Individuals.

3. Tax paid with Form 1040-C, U.S.Departing Alien Income Tax Return.

When filing Form 1040, include the taxpaid with Form 1040-C with the totalpayments on line 60. Identify the paymentin the area to the left of the entry.

As a dual-status taxpayer, yougenerally may claim tax credits using thesame rules that apply to resident aliens.

How To Report Income onForm 1040NR

Community IncomeIf either you or your spouse, or both youand your spouse, were nonresident aliensat any time during the tax year, and youhad community income during the year,treat the community income according tothe applicable community property lawsexcept as follows:q Earned income of a spouse, other thantrade or business or partnershipdistributive share income. The spousewhose services produced the incomemust report it on his or her separatereturn.q Trade or business income, other thanpartnership income. Treat this income asreceived by the husband unless the wifeexercises substantially all of themanagement over the trade or business.q Partnership income (or loss) receivedfrom a trade or business carried on by thepartnership. Treat this income (or loss) asreceived by the spouse who is the partnerand report it on that spouse's return.q Income derived from the separateproperty of one spouse that is not earnedincome, trade or business income, orpartnership distributive share income. Thespouse with the separate property mustreport this income on his or her separatereturn.

See Pub. 555, Community Property, formore details.

Kinds of Income

You must divide your income for the taxyear into the following three categories:

1. Income effectively connected witha U.S. trade or business. This income istaxed at the same rates that apply to U.S.citizens. Report it on page 1 of Form1040NR. Pub. 519 describes this incomein greater detail.

2. U.S. income not effectivelyconnected with a U.S. trade or business.This income is taxed at 30% unless atreaty between your country and the

United States has set a lower rate thatapplies to you. Report this income onpage 4 of Form 1040NR and figure the taxon it. Then, report the tax on line 46. Pub.519 describes this income more fully.Note: Use line 49 to report the 4% taxon U.S. source gross transportationincome.

3. Income exempt from U.S. tax.Complete items L and M on page 5 ofForm 1040NR and line 22 if applicable.

Dispositions of U.S. Real PropertyInterests

Gain or loss on the disposition of a U.S.real property interest by a nonresidentalien individual is treated as if the alienindividual were engaged in a trade orbusiness in the United States and as if thegain or loss were effectively connectedwith the conduct of that trade or business.Losses of individuals shall be taken intoaccount only to the extent they would betaken into account under section 165(c).See section 897 and its regulations.

Report gains and losses on thedisposition of U.S. real property interestson Schedule D (Form 1040) and Form1040NR, line 14. Also, net gains may besubject to the alternative minimum tax.See the instructions for line 45.

The nonrecognition rules (notrecognizing gain or loss) apply only whena U.S. real property interest is exchangedfor an interest the sale of which would besubject to U.S. tax.

Money and the fair market value ofproperty received in exchange for aninterest in a partnership, trust, or estate,

will, to the extent attributable to a U.S.real property interest held by thepartnership, trust, or estate, beconsidered as received from the sale orexchange of the U.S. real propertyinterest.

Gains or losses from the disposition ofa U.S. real property interest by apartnership, trust, or estate generally arepassed through and must be reported onthe income tax return of each partner orbeneficiary.U.S. Real Property Interests. A U.S.real property interest is any interest (otherthan an interest solely as a creditor) inreal property located in the United States

or the Virgin Islands, or any interest in adomestic corporation that is a U.S. realproperty holding corporation. Generally,real property includes:q Land and unsevered naturalproducts of the land, such as growingcrops and timber, and mines, wells, andother natural deposits.q Improvements on land, includingbuildings, other inherently permanentstructures, and structural components ofthese.q Personal property associated withthe use of real property, such asfarming, forestry, mining, or construction

equipment, or property used in lodgingfacilities or rented office space. See Pub.519 for exceptions.

A corporation is a U.S. real propertyholding corporation if the fair market valueof its U.S. real property interests is 50%or more of the fair market value of its U.S.real property interests, interests in foreignreal property, plus any other of its assetsthat are used or held for use in a tradeor business. For special rules, seesections 897(c)(4) and (5).



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An interest in a foreign corporation is aU.S. real property interest only if thecorporation elected to be treated as adomestic corporation.

An interest in a domestic corporation isnot a U.S. real property interest if at thedate of disposition of the interest in thecorporation: (a) the corporation did nothold any U.S. real property interests, and(b) all the U.S. real property interests heldby the corporation during the shorter ofthe periods described in section

897(c)(1)(A)(ii):1. Were disposed of in a transaction

in which all gain realized was recognized,or

2. Ceased to be U.S. real propertyinterests because of the application ofsection 897(c)(1)(B) to one or more othercorporations.Stock Regularly Traded. A U.S. realproperty interest does not include anyclass of stock of a domestic corporationthat is regularly traded on an establishedsecurities market, unless you held morethan 5% of that class of stock at any timeduring the shorter of the periodsdescribed in section 897(c)(1)(A)(ii).

Section 897(h) provides special rulesfor a real estate investment trust.Virgin Islands Real Estate. Gain or losson dispositions of real property interestslocated in the U.S. Virgin Islands isreported on returns filed with the VirginIslands tax authorities. Tax on thesedispositions is paid to the Virgin Islandstax authorities.

Income You May Elect To Treat asEffectively Connected With a U.S.Trade or Business

You may elect to treat some items ofincome as effectively connected with a

U.S. trade or business. The electionapplies to all income from real property,or an interest in real property, located inthe United States and held for theproduction of income. Income from realproperty includes:q Rental income from real property.q Profit from disposing of U.S. timber,coal, or iron ore while keeping a share init.q Rents and royalties from mines, oil orgas wells, or other natural resources.

The election does not apply todispositions of U.S. real property interestsdiscussed earlier.

To make the election, attach astatement to your return for the year of theelection. Include in your statement:

1. That you are making the election.2. A complete list of all your real

property, or any interest in real property,located in the United States (includinglocation). Give the legal identification ofU.S. timber, coal, or iron ore in which youhave an interest.

3. The extent of your interest in thereal property.

4. A description of any substantialimprovements on such real property.

5. Your income from the property.6. The dates you owned it.7. Whether the election is under

section 871(d) or treaty.

8. Details of any previous electionsand revocations of the real propertyelections.

Foreign Income Taxed by theUnited States

You may be required to report someincome from foreign sources on your U.S.return if it is effectively connected with aU.S. trade or business. For this foreignincome to be treated as effectivelyconnected with a U.S. trade or business,you must have a fixed place of businessin the United States. The income, gain,or loss must result directly from the usualbusiness activities of your U.S. office. Thekinds of foreign income that may be taxedat the graduated rates are:q Interest or dividends from the U.S.business.q Income from foreign sales made by

your U.S. office.q Rents or royalties you received for theuse of intangible property located outsidethe United States or the privilege of usingit. Such property includes patents,copyrights, trademarks, and franchises.

Special Rules for FormerU.S. Citizens and FormerLong-Term U.S. ResidentsSection 877 may affect your tax liability ifyou are a former citizen or formerlong-term resident of the United States.You are a former long-term resident if youwere a lawful permanent resident of theUnited States (i.e., you had a green card)for at least 8 out of the 15 consecutive taxyears ending with the year your residencyended. In determining if you are a formerlong-term resident, do not count any yearthat you were treated as a resident ofanother country under a tax treaty and didnot waive treaty benefits.

If you were a former citizen or formerlong-term resident and you relinquishedyour citizenship or terminated yourresidency after February 5, 1995, you aresubject to the provisions of section 877on your U.S. source income if one of theprincipal purposes of your action was to

avoid U.S. taxes.You are considered to have taxavoidance as a principal purpose if (1)your average annual net income tax forthe last 5 tax years ending before the dateof your action to relinquish yourcitizenship or terminate your residencywas more than $100,000, or (2) your networth on the date of your action was$500,000 or more. These amounts areadjusted for inflation if your expatriationaction is after 1996. If you expatriated in1997, your average annual net income taxhas to have been more than $106,000 or

your net worth has to have been $528,000or more for these rules to apply. Forexpatriation in 1998, the amounts are$109,000 and $543,000, respectively.

Although there are exceptions to theserules, you will qualify for an exception onlyif you have obtained a ruling from the IRSthat your renunciation of U.S. citizenshipor termination of U.S. residency did nothave as one of its principal purposes theavoidance of U.S. tax. For more detailsabout these exceptions, see section

877(c) and Notice 97-19, 1997-1 C.B.394.

If the rules of section 877 apply to you,check the first Yes box in item P onpage 5 of the form. You are subject totax on U.S. source income and gains oneither (1) a net basis at the graduatedrates applicable to individuals withallowable deductions, or (2) a gross basisat a rate of 30% under the rules of section871(a). See Chapter 4 of Pub. 519 formore details on the tax imposed undersection 871(a).

If you have items of U.S. source incomethat are subject to tax under section871(a), you will be taxed at a rate of 30%on your gross income only if this taxexceeds the tax at the regular graduatedrates on your net income. If the 30% taxon your gross income exceeds thegraduated tax on your net income, reportthose items on the appropriate lines onpage 4 of Form 1040NR. If the graduatedtax on your net income exceeds the 30%tax on your gross income, report yourincome on the appropriate lines on page1 of Form 1040NR and attach a statementdescribing the items and amounts ofincome that are subject to tax by reasonof section 877.

If you have other items of U.S. sourceincome that are not subject to tax undersection 871(a), you will be taxed on a netbasis at the regular graduated ratesapplicable to individuals. Report thisincome on the appropriate lines on page1 of Form 1040NR.

For purposes of computing the tax dueunder section 877, the following items ofincome are treated as U.S. source:

1. Gains on the sale or exchange ofpersonal property located in the UnitedStates.

2. Gains on the sale or exchange ofstock issued by a domestic corporationor debt obligations of the United States,U.S. persons, a state or political

subdivision thereof, and the District ofColumbia.

3. Income or gain derived from stockin a foreign corporation if you owned,either directly or indirectly (through therules of sections 958(a) and 958(b)) morethan 50% of the vote or value of the stockof the corporation on the date of yourrenunciation of citizenship or terminationof residency or at any time during the 2years preceding such date. Such incomeor gain is considered U.S. source only tothe extent of your share of the earningsand profits earned or accumulated prior



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to the date of renunciation of U.S.citizenship or termination of residency.

You may not claim that a tax treaty ineffect on August 21, 1996, prevents theimposition of tax by reason of section 877.

Annual Information Statement

If the expatriation rules apply to you andyou are liable for U.S. taxes, you mustcheck the second Yes box in item Pon page 5 of the form and attach astatement to Form 1040NR that sets forth

by category (e.g., dividends, interest, etc.)all items of U.S. and foreign source grossincome (whether or not taxable in theUnited States). The statement mustidentify the source of such income(determined under section 877 asmodified by Section V of Notice 97-19,1997-1 C.B. 394) and those items ofincome subject to tax under section 877.If the expatriation rules apply to you, youmust attach this statement to Form1040NR, even if you have fully satisfiedyour U.S. tax liability through withholdingof tax at source.

If you fail to furnish a completestatement, as described above, you will

not be considered to have filed a true andaccurate return. Therefore, you will not beentitled to any deductions or credits if yourtax liability for your 1997 taxable year islater adjusted. See section 874(a).

Line Instructions forForm 1040NR

Name, Identifying Number,and AddressName. If you are filing Form 1040NR foran estate or trust, enter the name of theestate or trust, and your name, title, andaddress. Also, give the name and addressof any U.S. grantors and beneficiaries.Identifying Number. If you are anindividual, you are generally required toenter your social security number (SSN).Apply for your SSN using Form SS-5,which you can get at Social SecurityAdministration (SSA) offices. Fill in FormSS-5 and return it to the SSA.

If you do not have an SSN and are noteligible to get one, you must get anindividual taxpayer identification number(ITIN). To apply for an ITIN, file Form

W-7 with the IRS. It usually takes about30 days to get an ITIN. Enter your ITINwherever your SSN is requested onyour tax return. If you are required toinclude another person's SSN on yourreturn and that person does not have andcannot get a SSN, enter that person'sITIN.

Note: An ITIN is for tax use only. It doesnot entitle you to social security benefitsor change your employment orimmigration status under U.S. law.

If you are filing Form 1040NR for anestate or trust, enter the employeridentification number of the estate or trust.

An incorrect or missing identifyingnumber may increase your tax or reduceyour refund.P.O. Box. Enter your box number onlyif your post office does not deliver mail toyour home.Foreign Address. Enter the informationin the following order: city, province orstate, and country. Follow the country'spractice for entering the postal code.Please do not abbreviate the countryname.

Filing StatusThe amount of your tax depends on yourfiling status. Before you decide which boxto check, read the following explanations.Were You Single or Married? If youwere married on December 31, consideryourself married for the whole year. If youwere single, divorced, or legally separatedunder a decree of divorce or separatemaintenance on December 31, consider

yourself single for the whole year. If youmeet the tests described under MarriedPersons Who Live Apart below, youmay consider yourself single for the wholeyear.

If your spouse died in 1997, consideryourself married to that spouse for thewhole year, unless you remarried beforethe end of 1997.Married Persons Who Live Apart.Some married persons who have a childand who do not live with their spouse mayfile as single. If you meet all five of thefollowing tests and you are a marriedresident of Canada or Mexico, or a U.S.national, check the box on line 1. If youmeet the tests and you are a marriedresident of Japan or the Republic ofKorea, check the box on line 2.

1. You file a separate return from yourspouse.

2. You paid more than half the cost tokeep up your home in 1997.

3. You lived apart from your spouseduring the last 6 months of 1997.

4. Your home was the principal homeof your child, stepchild, adopted child, orfoster child for more than half of 1997.

5. You claim this child as yourdependent or the child's other parentclaims him or her as a dependent under

the rules in Pub. 501, Exemptions,Standard Deduction, and FilingInformation, for children of divorced orseparated parents.Line 6Qualifying Widow(er) WithDependent Child. You may check thebox on line 6 and use joint return tax ratesfor 1997 if all seven of the followingapply.

1. You were a resident of Canada,Mexico, Japan, or the Republic of Korea,or were a U.S. national.

2. Your spouse died in 1995 or 1996and you did not remarry in 1997.

3. You have a child, stepchild,adopted child, or foster child whom youcan claim as a dependent.

4. This child lived in your home for allof 1997. Temporary absences, such as forschool, vacation, or medical care, countas time lived in the home.

5. You paid over half the cost ofkeeping up your home.

6. You were a resident alien or U.S.citizen the year your spouse died. Thisrefers to your actual status, not theelection that some nonresident aliens canmake to be taxed as U.S. residents.

7. You could have filed a joint returnwith your spouse the year he or she died,even if you did not actually do so.

ExemptionsExemptions for estates and trusts aredescribed in the instructions for line 36.Note: Residents of India who werestudents or business apprentices may beable to claim exemptions for their spouseand dependents. See Pub. 519 for details.Line 7bSpouse. If you checked filingstatus box 3 or 4, you can take anexemption for your spouse only if yourspouse had no gross income for U.S. taxpurposes and cannot be claimed as adependent on another U.S. taxpayer'sreturn. (You can do this even if yourspouse died in 1997.) In addition, if youchecked filing status box 4, your spousemust have lived with you in the UnitedStates at some time during 1997. Finally,your spouse must have an SSN or anITIN. If your spouse is not eligible toobtain an SSN, he or she can file FormW-7 with the IRS to apply for an ITIN. SeeIdentifying Number above for additionalinformation.Line 7cDependents. Only U.S.nationals, and residents of Canada,Mexico, Japan, and the Republic ofKorea, may claim exemptions for theirdependents. If you were a U.S. national(American Samoan) or a resident ofCanada or Mexico, you can claimexemptions for your children and otherdependents on the same terms as U.S.citizens. See Pub. 501 for more details. Ifyou were a resident of Japan or theRepublic of Korea, you may claim anexemption for any of your children who

lived with you in the United States atsome time during 1997.You can take an exemption for each of

your dependents who was alive duringsome part of 1997. This includes a babyborn in 1997 or a person who died in1997.

If you have more than fivedependents, attach a statement to yourreturn with the required information.

Line 7c, Column (2). You must entereach dependent's identifying number(SSN, ITIN, or ATIN). If you do not enterthe correct identifying number, at the time



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we process your return, we may disallowthe exemption claimed for the dependent.If your dependent child was born and diedin 1997 and you do not have anidentifying number for the child, attach acopy of the child's birth certificate insteadand enter DIED in column (2).

You should apply for an identifyingnumber (SSN, ITIN, or ATIN) for yourdependent in time to receive it before yourreturn is due. If your dependent does nothave an identifying number by the date

your return is due, see Extension ofTime To File on page 3.

Line 7c, Column (4). Enter the numberof months your dependent lived with youin 1997. Count temporary absences suchas for school or vacation as time lived inyour home. If your dependent was bornor died in 1997, enter 12 in this column.

Children Who Did Not Live With YouDue to Divorce or Separation. If you areclaiming a child who did not live with youunder the rules in Pub. 501 for childrenof divorced or separated parents, attachForm 8332 or similar statement to yourreturn. But see Exception below. If yourdivorce decree or separation agreementwent into effect after 1984 and it statesyou can claim the child as your dependentwithout regard to any condition, such aspayment of support, you may attach acopy of certain pages from the decree oragreement instead. See Pub. 504,Divorced or Separated Individuals, fordetails.Note: You must attach the requiredinformation even if you filed it in an earlieryear.

Exception. You do not have to attachForm 8332 or similar statement if yourdivorce decree or written separationagreement went into effect before 1985

and it states that you can claim this childas your dependent.Other Dependent Children. Include

the total number of children who did notlive with you for reasons other thandivorce or separation on the line labeledDependents on 7c not entered above.

Rounding Off to WholeDollarsTo round off cents to the nearest wholedollar on your forms and schedules, dropamounts under 50 cents and increaseamounts from 50 to 99 cents to the next

dollar. If you do round off, do so for allamounts. But if you have to add two ormore amounts to figure the amount toenter on a line, include cents when addingand only round off the total.

Income EffectivelyConnected With U.S. Tradeor BusinessPub. 519 explains how income isclassified and what income you shouldreport here. The instructions for this

section assume you have decided that theincome involved is effectively connectedwith a U.S. trade or business in which youwere engaged. But your decision may notbe easy. Interest, for example, may beeffectively connected with a U.S. trade orbusiness, it may not be, or it may be taxexempt. The tax status of income alsodepends on its source. Under somecircumstances, items of income fromforeign sources are treated as effectivelyconnected with a U.S. trade or business.

Other items are reportable as effectivelyconnected or not effectively connectedwith a U.S. trade or business, dependingon how you elect to treat them.Line 8Wages, Salaries, Tips, etc.Enter the total of your effectivelyconnected wages, salaries, tips, etc. But,do not include amounts exempted undera tax treaty and reported in Item M onpage 5 of Form 1040NR. Also include inthis total:q Tip income you did not report to youremployer. Also include allocated tipsshown on your W-2 form(s) unless youcan prove that you received less.Allocated tips should be shown in box 8

of your W-2 form(s). They are notincluded as income in box 1. See Pub.531, Reporting Tip Income, for moredetails.

Caution: You may owe social securityand Medicare tax on unreported orallocated tips. See the instructions for line47.q Dependent care benefits, whichshould be shown in box 10 of your W-2form(s). But first complete Form 2441,Child and Dependent Care Expenses, tosee if you may exclude part or all of thebenefits.q Employer-provided adoption

benefits, which should be shown in box13 of your W-2 form(s) with code T. Butfirst complete Form 8839 to see if youcan exclude part or all of the benefits.q Excess salary deferrals. The amountdeferred should be shown in box 13 ofyour W-2 form and the DeferredCompensation box in box 15 should bechecked. If the total amount you deferredfor 1997 under all plans was more than$9,500, include the excess on line 8. Buta different limit may apply if amounts weredeferred under a tax-sheltered annuityplan or an eligible plan of a state or localgovernment or tax-exempt organization.See Pub. 575, Pension and Annuity

Income, for details.Caution: You maynotdeduct theamount deferred. It is not included asincome in box 1 of your W-2 form.q Corrective distributions shown onForm 1099-R of (1) excess salarydeferrals and (2) excess contributions toa retirement plan. But do not includedistributions from an IRA* on line 8.Instead, report them on lines 16a and16b.q Disability pensions shown on Form1099-R if you have not reached theminimum retirement age set by your

employer. Disability pensions receivedafter you reach that age and otherpensions shown on Form 1099-R (otherthan payments from an IRA*) are reportedon lines 17a and 17b.

*This includes a SEP or SIMPLE IRA.Missing or Incorrect Form W-2. If you

do not get a Form W-2 by February 2,1998, ask your employer for it. Even if youdo not get a Form W-2, you must stillreport your earnings. If you lose yourForm W-2 or it is incorrect, ask your

employer for a new one.Line 9aTaxable Interest Income.Report on line 9a all of your taxableinterest income from assets effectivelyconnected with a U.S. trade or business.

If you received interest not effectivelyconnected with a U.S. trade or business,report it on page 4 of Form 1040NR,unless it is tax exempt under a treaty. SeePub. 901, U.S. Tax Treaties. In addition,interest from a U.S. bank, savings andloan association, or similar institution, andfrom certain deposits with U.S. insurancecompanies, is tax exempt if it is noteffectively connected with a U.S. trade orbusiness.

Interest credited in 1997 on depositsyou could not withdraw because of thebankruptcy or insolvency of the financialinstitution may not have to be included inyour 1997 income. For details, see Pub.550, Investment Income and Expenses.Line 9bTax-Exempt Interest. If youreceived any tax-exempt interest income,such as from municipal bonds, report iton line 9b. Include any exempt-interestdividends from a mutual fund or otherregulated investment company. Do notinclude interest earned on your IRA.Line 10Dividend Income. Enter yourtotal ordinary dividends from assets

effectively connected with a U.S. trade orbusiness. If you received capital gaindistributions, report them on Schedule D(Form 1040).

Nontaxable Distributions. Somedistributions are nontaxable because theyare a return of your cost. They will not betaxed until you recover your cost. Youmust reduce your cost (or other basis) bythese distributions. After you get back allof your cost (or other basis), you mustreport these distributions as capital gains.Line 11Taxable Refunds, Credits, orOffsets of State and Local IncomeTaxes.Tip: None of your refund is taxable if, in

the year you paid the tax, youdid notitemize deductions.

If you received a refund, credit, or offsetof state or local income taxes in 1997, youmay receive a Form 1099-G. If you choseto apply part or all of the refund to your1997 estimated state or local income tax,the amount applied is treated as receivedin 1997.

For details on how to figure the amountyou must report as income, seeRecoveries in Pub. 525, Taxable andNontaxable Income.



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Line 12Scholarship and FellowshipGrants. If you received a scholarship orfellowship, part or all of it may be taxable.

If you were a degree candidate, theamounts you used for expenses otherthan tuition and course-related expensesare generally taxable. For example,amounts used for room, board, and travelare generally taxable.

If you were not a degree candidate, thefull amount of the scholarship orfellowship is generally taxable. Also,

amounts received as a scholarship orfellowship that are payment for teaching,research, or other services are taxableeven if the services were required to getthe grant.

Report the total amount of the grant online 12 and show any nontaxable part online 30. If the grant was reported on Form1042-S, enter the gross amount fromcolumn (b) on line 12. But do not includeamounts exempted under a tax treaty andreported in item M on page 5 of Form1040NR. Attach a statement that shows:the amount of your grant, the dates itcovers, the grantor's name, expenses thegrant covers, and the conditions underwhich it was given to you. Explain howmuch was taxable, how much was taxexempt, and why.

Attach any Form 1042-S or Form W-2you received from the college orinstitution. If you did not receive a 1042-Sor W-2 form, attach a statement from thecollege or institution (on their letterhead)showing the details of the grant.Line 13Business Income or (Loss).If you operated your own business orpracticed your profession as a soleproprietor, report your income andexpenses on Schedule C or ScheduleC-EZ (Form 1040).

Include any income you received as adealer in stocks, securities, andcommodities through your U.S. office. Ifyou dealt in these items through anindependent agent, such as a U.S. broker,custodian, or commissioned agent, yourincome may not be considered effectivelyconnected with a U.S. business. Forgeneral information on business incomeor loss, see the Instructions for ScheduleC (Form 1040) and see Pub. 334, TaxGuide for Small Business.Line 14Capital Gain or (Loss). Seethe Instructions for Schedule D (Form1040). Enter the effectively connectedgain or (loss) from Schedule D (Form

1040). You may need Pub. 544, Salesand Other Dispositions of Assets.Gains and losses from disposing of

U.S. real property interests are taxed asif you were engaged in a U.S. trade orbusiness and are treated as effectivelyconnected with that trade or business.See Dispositions of U.S. Real PropertyInterests on page 4.Line 15Other Gains or (Losses). Ifyou sold or exchanged assets used in aU.S. trade or business, see theinstructions for Form 4797.

Lines 16a and 16bIRA Distributions.You should receive a Form 1099-Rshowing the amount of the distributionfrom your individual retirementarrangement (IRA). Leave line 16a blankand enter the total distribution on line 16b.

Exception: Do not enter your total IRAdistribution on line 16b if either 1 or 2below applies.

1. You made nondeductiblecontributions to any of your IRAs for 1997or an earlier year. Instead, use Form8606 to figure the amount to enter on line16b; enter the total distribution on line16a. If you made nondeductiblecontributions for 1997, also see Pub. 590,Individual Retirement Arrangements(IRAs).

2. You rolled your IRA distributionover into another IRA. Enter the totaldistribution on line 16a. If the total on line16a was rolled over, enter zero on line16b. If the total was not rolled over, enterthe part not rolled over on line 16b. But if1 above also applies, use Form 8606 tofigure the taxable part.

Caution: You may have to pay anadditional tax if you received an earlydistribution from your IRA and the totaldistribution was not rolled over or youwere born before July 1, 1926, andreceived less than the minimum requireddistribution. See the instructions for line48 for details.Lines 17a and 17bPensions andAnnuities. Use lines 17a and 17b toreport effectively connected pension andannuity payments you received, including

payments (distributions) from retirementplans, life insurance annuity contracts,profit-sharing plans, andemployee-savings plans. See page 9 fordetails on rollovers and lump-sumdistributions. But if this income is noteffectively connected with your U.S. tradeor business, report it on line 72.

Do not include the following paymentson lines 17a and 17b. Instead, reportthem on line 8.

q Disability pensions received before youreach the minimum retirement age set byyour employer.

Simplified Method WorksheetLines 17a and 17b (keep for your records)

Enter the total pension or annuity payments received this year. Also,enter this amount on Form 1040NR, line 17a

1.1.

Enter your cost in the plan at the annuity startingdate plus any death benefit exclusion (seepage 9)

2.

2.

3. 3.

Divide line 2 by the number on line 3 4.4.

Multiply line 4 by the number of months for whichthis years payments were made. If your annuitystarting date was before 1987, skip lines 6 and 7and enter this amount on line 8. Otherwise, go toline 6

5.

5.

Enter the amount, if any, recovered tax free inyears after 1986 6.

6.

Subtract line 6 from line 2 7.7.

Enter the smaller of line 5 or line 78. 8.

Taxable amount. Subtract line 8 from line 1. Enter the result, but notless than zero. Also, enter this amount on Form 1040NR, line 17b. Ifyour Form 1099-R shows a larger amount, use the amount on thisline instead of the amount from Form 1099-R

9.

9.

Note: If you had more than one partially taxable pension or annuity, figure the taxablepart of each separately. Enter the total of the taxable parts on Form 1040NR, line 17b.Enter the total pension or annuity payments received in 1997 on Form 1040NR, line 17a.

Enter the appropriate number from the table below

Table For Line 3 Above

IF the age at annuitystarting date (seepage 9) was . . .

55 or under

5660

6165

6670

71 or older

300

260

240

170

120

360

310

260

210

160

AND your annuity starting date was

before November 19,1996, enter on line 3 . . .

after November 18,1996, enter on line 3 . . .



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q Corrective distributions of excess salarydeferrals or excess contributions toretirement plans.

Some annuities are tax-exempt. Seesection 871(f).Note: If you perform services in theUnited States, your income is effectivelyconnected with the conduct of a U.S.trade or business. When you receive apension in a later year as a result of theseservices, the pension is also consideredeffectively connected with the conduct of

a U.S. trade or business.In general, you should receive a Form

1099-R showing the amount youreceived. Attach Form 1099-R to Form1040NR if any Federal income tax waswithheld.

Fully Taxable Pensions andAnnuities. If your pension or annuity isfully taxable, enter it on line 17b; do notmake an entry on line 17a. Yourpayments are fully taxable if either of thefollowing applies:

1. You did not contribute to the costof your pension or annuity, or

2. You got your entire cost back tax

free before 1997.Fully taxable pensions and annuities

also include military retirement pay shownon Form 1099-R. For details on militarydisability pensions, see Pub. 525,Taxable and Nontaxable Income. If youreceived a Form RRB-1099-R, see Pub.575, Pension and Annuity Income, forinformation on how to report your benefits.

Partially Taxable Pensions andAnnuities. If your pension or annuity ispartially taxable and your Form 1099-Rdoes not show the taxable part, you mustuse the General Rule to figure the taxablepart. The General Rule is explained inPub. 939, Pension General Rule.

However, if your annuity starting date(defined below) was after July 1, 1986,you may be able to use the SimplifiedMethod explained below. But if yourannuity starting date was after November18, 1996, and items 1, 2, and 3 belowunder Simplified Method apply, youmust use the Simplified Method to figurethe taxable part.

You can ask the IRS to figure thetaxable part for you for a $75 fee. Fordetails, see Pub. 939.

If your Form 1099-R shows a taxableamount, you may report that amount online 17b. But you may be able to report alower taxable amount by using theGeneral Rule or the Simplified Method.

Once you have figured the taxable partof your pension or annuity, enter thatamount on line 17b and the total on line17a.

Annuity Starting Date. Your annuitystarting date is the later of the first day ofthe first period for which you received apayment, or the date the plan'sobligations became fixed.

Simplified Method. If your annuitystarting date (defined above) was afterJuly 1, 1986, and all three of the following

apply, you can use this simpler method.But if your annuity starting date was afterNovember 18, 1996, and all three of thefollowing apply, you must use theSimplified Method.

1. The payments are for (a) your lifeor (b) your life and that of yourbeneficiary.

2. The payments are from a qualifiedemployee plan, a qualified employeeannuity, or a tax-sheltered annuity.

3. At the time the pension or annuitypayments began, either you were underage 75 or the number of years ofguaranteed payments was fewer than 5.See Pub. 575 for the definition ofguaranteed payments.

If all three apply, use the worksheet onpage 8 to figure the taxable part of yourpension or annuity. For more details onthe Simplified Method, see Pub. 575.

Age at Annuity Starting Date. If youare the retiree, use your age on theannuity starting date. If you are thesurvivor of a retiree, use the retiree's ageon his or her annuity starting date. If youare the beneficiary of an employee who

died, see Pub. 575. If there is more thanone beneficiary, see Pub. 575 to figureeach beneficiary's taxable amount.

Changing Methods. If your annuitystarting date was after July 1, 1986, andbefore November 19, 1996, you may beable to change from the General Rule tothe Simplified Method (or the other wayaround). For details, see Pub. 575.

Death Benefit Exclusion. If you arethe beneficiary of an employee or formeremployee who died before August 21,1996, amounts paid to you by, or onbehalf of, an employer because of thedeath of the employee may qualify for adeath benefit exclusion of up to $5,000.

If you are entitled to this exclusion, add itto the amount you enter on line 2 of theworksheet on page 8. Do this even if theForm 1099-R shows a taxable amount.The payer of the annuity cannot add thedeath benefit exclusion to your cost whenfiguring the taxable amount. Special rulesapply if you are the survivor under a jointand survivor annuity. For details, see Pub.575.

Rollovers. A rollover is a tax-freedistribution of cash or other assets fromone retirement plan that is contributed toanother plan. Use lines 17a and 17b toreport a rollover, including a directrollover, from one qualified employer's

plan to another or to an IRA or SEP.Enter on line 17a the total distribution

before income tax or other deductionswere withheld. This amount should beshown in box 1 of Form 1099-R. From thetotal on line 17a, subtract anycontributions (usually shown in box 5) thatwere taxable to you when made. Fromthat result, subtract the amount that wasrolled over either directly or within 60 daysof receiving the distribution. Enter theremaining amount, even if zero, on line17b. Write Rollover next to line 17b.

Special rules apply to partial rolloversof property. For more details on rollovers,including distributions under qualifieddomestic relations orders, see Pub. 575.

Lump-Sum Distributions. If youreceived a lump-sum distribution from aprofit-sharing or retirement plan, yourForm 1099-R should have the Totaldistribution box in box 2b checked. Youmay owe an additional tax if you receivedan early distribution from a qualifiedretirement plan and the total amount was

not rolled over. For details, see theinstructions for line 48.

Enter the total distribution on line 17aand the taxable part on line 17b.Tip: You may pay less tax on thedistribution if you were at least age 591/2on the date of the distribution, you meetcertain other conditions, and you chooseto use Form 4972, Tax on Lump-SumDistributions, to figure the tax on any partof the distribution. You may also be ableto use Form 4972 if you are thebeneficiary of a deceased employee whowas either age 591/2 or older on the dateof death or was born before 1936. Fordetails, see Form 4972.Line 20UnemploymentCompensation. You should receive aForm 1099-G showing the totalunemployment compensation amountpaid to you in 1997.

If you received an overpayment ofunemployment compensation in 1997 andyou repaid any of it in 1997, subtract theamount you repaid from the total amountyou received. Enter the result on line 20.Also, enter Repaid and the amount yourepaid on the dotted line next to line 20.If, in 1997, you repaid unemploymentcompensation that you included in grossincome in an earlier year, you may deduct

the amount repaid on Schedule A, line 11.But if you repaid more than $3,000, seeRepayments in Pub. 525, Taxable andNontaxable Income, for details on how toreport the repayment.

Line 21Other Income. Use line 21 toreport any other income effectivelyconnected with your U.S. business that isnot reported elsewhere on your return orother schedules. List the type and amountof income. If necessary, show therequired information on an attachedstatement. For more details, seeMiscellaneous Taxable Income in Pub.525.

Examples of income to report on line

21 are:q Repayments of expenses you deductedin an earlier year if they reduced your tax.q Fees received as a nonprofessionalfiduciary, such as an executor oradministrator of the estate of a deceasedfriend or relative.q Recapture of clean-fuel vehiclededuction. See Pub. 535, BusinessExpenses.

Report other income on page 4 of Form1040NR if not effectively connected witha U.S. trade or business.



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Net Operating Loss. If you had a netoperating loss in an earlier year to carryforward to 1997, include it as a negativeamount in parentheses on line 21. Attacha statement showing how you figured theamount. See Pub. 536, Net OperatingLosses, for more details.Line 22. Use line 22 to report your totaleffectively connected income that isexempt from tax by a tax treaty. Do notinclude this exempt income on line 23.Also, you must complete item M on page

5 of Form 1040NR.

AdjustmentsAdjustments are amounts you cansubtract from your income effectivelyconnected with a U.S. trade or business.Line 24IRA Deduction.Tip: You can make contributions to yourIRA even if you cannot deduct them. Butyou must useForm 8606to report thesenondeductible contributions.

Use line 24 to deduct contributions toyour individual retirement arrangement(IRA).

Caution: If you were covered by aretirement plan (qualified pension,profit-sharing (including 401(k)), annuity,Keogh, SEP, SIMPLE, etc.) at work orthrough self-employment, your IRAdeduction may be reduced or eliminated.Earnings on contributions to your IRA arenot taxed until they are distributed to you.

Special Rule for Married Individuals.If you checked filing status box 3, 4, or 5and you were not covered by a retirementplan but your spouse was, you areconsidered covered by a plan unless youlived apart from your spouse for all of1997.

Not Covered by a Retirement Plan. Ifyou were not covered by a retirementplan, you can take a full IRA deduction.

Covered by a Retirement Plan. YourForm W-2 should have the Pensionplan box in box 15 checked if you werecovered by your employer's plan even ifyou were not vested in the plan. You arealso covered by a plan if you wereself-employed and had a Keogh, SEP, orSIMPLE retirement plan.

See Pub. 590, Individual RetirementArrangements (IRAs), for more details.Line 25Medical Savings Account(MSA) Deduction. If you madecontributions to an MSA for 1997, you

may be able to take this deduction. SeeForm 8853, Medical Savings Accountsand Long-Term Care InsuranceContracts, for details.Line 26Moving Expenses. Employeesand self-employed persons (includingpartners) can deduct certain movingexpenses. The move must be inconnection with employment thatgenerates effectively connected income.

You can take this deduction if youmoved in connection with your job orbusiness and your new workplace is at

Self-Employed Health Insurance Deduction WorksheetLine 27(keep for your records)

1. Enter the total amount paid in 1997 for health insurance coverageestablished under your business for 1997 for you, your spouse,and dependents. But do not include amounts for any month youwere eligible to participate in an employer-sponsored health plan 1.

2. Multiply line 1 by 40% (.40) 2.

3. Enter your net profit and any other earned income* from thebusiness under which the insurance plan is established, minusany deduction you claim on Form 1040NR, line 28 3.

4. Self-employed health insurance deduction. Enter the smallerof line 2 or line 3 here and on Form 1040NR, line 27 4.

*Earned income includes net earnings and gains from the sale, transfer, or licensing ofproperty you created. It does not include capital gain income.

least 50 miles farther from your old homethan your old home was from your oldworkplace. If you had no formerworkplace, your new workplace must beat least 50 miles from your old home. Thededuction is generally limited to moves toor within the United States or itspossessions. If you meet theserequirements, see Pub. 521, MovingExpenses. Use Form 3903, MovingExpenses, to figure the amount to enteron this line.Line 27Self-Employed HealthInsurance Deduction.Tip: Beginning in 1997, you may be ableto use part of the amount paid for qualifiedlong-term care insurance to figure thededuction. SeePub. 535for details,including limits on the amount you mayuse.

If you were self-employed and had anet profit for the year, you may be able todeduct part of the amount paid for healthinsurance on behalf of yourself, yourspouse, and dependents. The insurance

plan must be established under yourbusiness. But if you were also eligible toparticipate in any subsidized health planmaintained by your or your spouse'semployer for any month or part of a monthin 1997, amounts paid for healthinsurance coverage for that month cannotbe used to figure the deduction. For moredetails, see Pub. 535, BusinessExpenses.

If you qualify to take the deduction, usethe worksheet above to figure the amountyou can deduct.Line 28Keogh and Self-EmployedSEP and SIMPLE Plans. If you wereself-employed or a partner, you may be

able to take this deduction. See Pub. 560.Line 29Penalty on Early Withdrawalof Savings. The Form 1099-INT orForm 1099-OID you received will showthe amount of any penalty you werecharged.Line 30Scholarship and FellowshipGrants Excluded. If you were a degreecandidate, enter amounts used for tuitionand course-related expenses (fees,books, etc.). Do not include any amountshown on line 22.

Line 31. Include in the total on line 31any of the following adjustments that arerelated to your effectively connectedincome. On the dotted line next to line31, enter the amount of your deductionand identify it as indicated.

q Performing-arts-related expenses (seeForm 2106 or Form 2106-EZ.) Identifyas QPA.

q Reforestation amortization (see Pub.535). Identify as RFST.q Repayment of supplementalunemployment benefits under the TradeAct of 1974 (see Pub. 525). Identify asSub-Pay TRA.q Contributions to section 501(c)(18)pension plans (see Pub. 575). Identify as501(c)(18).q Deduction for clean-fuel vehicles (seePub. 535). Identify as Clean-Fuel.Line 32Adjusted Gross Income. Ifline 32 is less than zero, you may have anet operating loss that you can carry toanother tax year. See Pub. 536, NetOperating Losses.

Tax Computation on IncomeEffectively Connected With aU.S. Trade or BusinessLine 34Itemized Deductions. Entertotal itemized deductions from ScheduleA.

Note: Residents of India who werestudents or business apprentices may beable to take the standard deductioninstead of their itemized deductions. SeePub. 519 for details.Line 36Deduction for Exemptions.

You can claim exemptions only to theextent of your income that is effectivelyconnected with a U.S. trade or business.

If you file as an individual, multiply$2,650 by the total number of exemptionsentered on line 7d. (If you were a residentof Japan or the Republic of Korea, youmust figure the exemptions for yourspouse and children according to theproportion your U.S. income bears to yourtotal income. For details, see Pub. 519.)But use the worksheet on page 11 tofigure the amount, if any, to enter on line36 if your adjusted gross income from line



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Deduction for Exemptions WorksheetLine 36 (keep for your records)See the instructions for line 36.

2. Multiply $2,650 by the total number of exemptions claimed onForm 1040NR, line 7d

3. Enter the amount from Form 1040NR, line 334. Enter $90,900 ($121,200 if you checked filing

status box 1 or 2; $181,800 if you checked filingstatus box 6)

5. Subtract line 4 from line 3. If zero or less, stop;enter the amount from line 2 above on Form1040NR, line 36

Note: If line 5 is more than $122,500 (more than$61,250 if you checked filing status box 3, 4, or5), stop; you cannot take a deduction forexemptions. Enter -0- on Form 1040NR, line 36.

6. Divide line 5 by $2,500 ($1,250 if you checked filingstatus box 3, 4, or 5). If the result is not a wholenumber, round it up to the next higher wholenumber (for example, round 0.0004 to 1)

7. Multiply line 6 by 2% (.02) and enter the result asa decimal amount

8. Multiply line 2 by line 7

9. Deduction for exemptions. Subtract line 8 from line 2. Enter theresult here and on Form 1040NR, line 36

2.

8.

9.

3.

4.

5.

6.

7.

Is the amount on Form 1040NR, line 33, more than the amount shown on line 4 belowfor your filing status?

.

No. Stop. Multiply $2,650 by the total number of exemptions claimed on Form 1040NR,line 7d, and enter the result on line 36.

Yes. Go to line 2.

1.

Line 42Other Credits. Include in thetotal on line 42 any of the following creditsand check the appropriate box. If box d ischecked, also enter the form number. Tosee if you can take the credit, see theform or publication indicated.q Mortgage interest credit. If a state orlocal government gave you a mortgagecredit certificate, see Form 8396.q Credit for prior year minimum tax. If youpaid alternative minimum tax in a prioryear, see Form 8801.q Qualified electric vehicle credit. If youplaced a new electric vehicle in service in1997, see Form 8834.q General business credit. This creditconsists of a number of credits thatusually apply only to individuals who arepartners, shareholders in an Scorporation, self-employed, or who haverental property. See Form 3800 or Pub.334, Tax Guide for Small Business.q Empowerment zone employment credit.See Form 8844.q District of Columbia first-timehomebuyer credit. See Form 8859.Line 43. If you sold fuel produced from

a nonconventional source, see section 29to find out if you can take thenonconventional source fuel credit. Ifyou can, attach a schedule showing howyou figured the credit. Include the creditin the total on line 43. Enter the amountand FNS next to line 43.

Other TaxesLine 45Alternative Minimum Tax.The tax law gives special treatment tosome kinds of income and allows specialdeductions and credits for some kinds ofexpenses. If you benefit from theseprovisions, you may have to pay aminimum amount of tax through thealternative minimum tax. This tax isfigured on Form 6251 for individuals. Ifyou are filing for an estate or trust, getSchedule I (Form 1041) and itsinstructions to see if you owe this tax.

If you have any of the adjustments orpreferences from the list on page 12, oryou are claiming a net operating lossdeduction or the foreign tax credit, youmust complete Form 6251. Otherwise, tosee if you should complete Form 6251,add the amount on line 35 of Form1040NR to the amounts on lines 3 and15 of Schedule A (Form 1040NR). If the

total is more than the dollar amountshown below that applies to you, fill inForm 6251.q $33,750 if you checked filing status box1 or 2.q $22,500 if you checked filing status box3, 4, or 5.q $45,000 if you checked filing status box6.

Disposition of U.S. Real PropertyInterests. If you disposed of U.S. realproperty interests at a gain, you mustmake a special computation to see if you

33 is more than $90,900 ($121,200 if youchecked filing status box 1 or 2; $181,800if you checked filing status box 6).

If you are filing for an estate, enter$600 on line 36. If you are filing for a trustwhose governing instrument requires it todistribute all its income currently, enter$300 on line 36. Any other trust is allowedan exemption of $100.

Line 38Tax. Use one of the followingmethods to figure your tax. Also, includeon line 38 any tax from Form 4972, Taxon Lump-Sum Distributions, and Form8814, Parents' Election To Report Child'sInterest and Dividends. Be sure to checkthe appropriate box.

Tax Table. If your taxable income (line37) is less than $100,000, you must usethe Tax Table to find your tax unless youare required to use Form 8615 orSchedule D (Form 1040). The Tax Tablestarts on page 19. Be sure you use thecorrect column. If you checked filingstatus box 3, 4, or 5, you must use theMarried filing separatelycolumn.

Tax Rate Schedules. You must usethe Tax Rate Schedules on page 31 tofigure your tax if your taxable income is$100,000 or more, OR you are filing foran estate or trust, unless you are requiredto use Form 8615 or Schedule D (Form1040).

Schedule D (Form 1040). If you had anet capital gain on Schedule D (Form1040) and the amount on Form 1040NR,line 37, is more than zero, use Part IV ofSchedule D (Form 1040) to figure yourtax.

Form 8615. You must generally useForm 8615 to figure the tax for any childwho was under age 14 on January 1,1998, and who had more than $1,300 ofinvestment income, such as taxableinterest or dividends, that is effectivelyconnected with a U.S. trade or business.But if neither of the child's parents wasalive on December 31, 1997, do not use

Form 8615 to figure the child's tax.

CreditsLine 39Credit for Child andDependent Care Expenses. You maybe able to take this credit if you paidsomeone to care for your child under age13 or your dependent who could not carefor himself or herself. For details, seeForm 2441.Line 40Adoption Credit. You may beable to take this credit if you paidexpenses in 1997 to adopt a child and theadoption was final in or before 1997. SeeForm 8839, Qualified Adoption Expenses,for details.Line 41Foreign Tax Credit. Form1116 explains when you can take thiscredit for payment of income tax to aforeign country. To take it, you mustreport income from foreign sources. SeeForeign Income Taxed by the UnitedStates on page 5. You also must havepaid or owe foreign tax on that income.Also, see Pub. 514, Foreign Tax Creditfor Individuals.



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owe this tax. For details, see theInstructions for Form 6251.

Adjustments and Preferences:1. Accelerated depreciation.

2. Income from incentive stockoptions.

3. Tax-exempt interest from privateactivity bonds.

4. Intangible drilling, circulation,research, experimental, or miningexploration and development costs.

5. Amortization of pollution-controlfacilities or depletion.6. Income or (loss) from tax-shelter

farm activities or passive activies.7. Percentage-of-completion income

from long-term contracts.8. Installment sale income.

Caution: Form 6251 should be filled infor a child under age 14 if the total of thechild's adjusted gross income from Form1040NR, line 33, exceeds the child'searned income by more than $1,300.Line 47Social Security and MedicareTax on Tip Income Not Reported toEmployer. If you are subject to social

security and Medicare tax, you receivedtips of $20 or more in any month, and youdid not report the full amount to youremployer, you must pay the socialsecurity and Medicare or railroadretirement (RRTA) tax on the unreportedtips. You must also pay this tax if yourW-2 form(s) shows allocated tips that youare including in your income on Form1040NR, line 8.

To figure the tax, use Form 4137,Social Security and Medicare Tax onUnreported Tip Income. To pay the RRTAtax, contact your employer. Youremployer will figure and collect the tax.Caution: You may be charged a penalty

equal to 50% of the social security andMedicare tax due on tips you received butdid not report to your employer.Line 48Tax on Qualified RetirementPlans (Including IRAs) and MSAs. Ifany of the following apply, see Form5329 and its instructions to see if you owethis tax and if you must file Form 5329.

1. You received any early distributionsfrom (a) a qualified retirement plan(including your IRA), (b) an annuity, or (c)a modified endowment contract enteredinto after June 20, 1988.

2. You made excess contributions toyour IRA or MSA.

3. You were born before July 1, 1926,and did not take the minimum requireddistribution from your qualified retirementplan.

Exception. If only item 1 above appliesto you and distribution code 1 is shown inbox 7 of your Form 1099-R, you do nothave to file Form 5329. Instead, multiplythe taxable amount of the distribution by10% (.10) and enter the result on line 48.The taxable amount of the distribution isthe part of the distribution you reportedon line 16b or line 17b of Form 1040NR

or on Form 4972. Also, enter No on thedotted line next to line 48 to indicate thatyou do not have to file Form 5329. But ifdistribution code 1 is incorrectly shown inbox 7, you must file Form 5329.Line 49Transportation Tax.Nonresident alien individuals are subjectto a 4% tax on U.S. source grosstransportation income that is noteffectively connected with a U.S. trade orbusiness. However, the term U.S. sourcegross transportation income does not

include any such income that is taxable ina possession of the United States underthe provisions of the Internal RevenueCode as applied to that possession.

For purposes of this tax, transportationincome will not be treated as effectivelyconnected with the conduct of a trade orbusiness in the United States unless:

1. You had a fixed place of businessin the United States involved in theearning of transportation income, and

2. Substantially all of your U.S. sourcegross transportation income wasattributable to regularly scheduledtransportation. Or, in the case of incomefrom the leasing of a vessel or aircraft, itwas attributable to a fixed place ofbusiness in the United States. Seesections 887 and 863 for rules, definitions,and exceptions.

You may be exempt from this taxbecause of a treaty or an exchange ofnotes between the United States and thecountry of which you are a resident. If thecountry of which you are a resident doesnot impose tax on the shipping or aircraftincome of U.S. persons, you may also beexempt from this tax. If you are exemptfrom the tax for one of these reasons, youmust attach a statement to Form 1040NRidentifying your country of residence and

the treaty, note, or law and provisionsunder which you claim exemption from thetax.

If you owe this tax, you must attach astatement to your return that includes theinformation described in Pub. 519.Line 50Household EmploymentTaxes. If any of the following apply, getSchedule H (Form 1040) and itsinstructions to see if you owe these taxes.

1. You paid any one householdemployee (defined below) cash wages of$1,000 or more in 1997.

2. You withheld Federal income taxduring 1997 at the request of anyhousehold employee.

3. You paid total cash wages of$1,000 or more in any calendar quarterof 1996 or 1997 to household employees.

Tip: For purposes of item1, do not countamounts paid to an employee who wasunder age 18 at any time in 1997 and wasa student.

Household Employee. Any personwho does household work is a householdemployee if you can control what will bedone and how it will be done. Householdwork includes work done in or around

your home by babysitters, nannies, healthaides, maids, yard workers, and similardomestic workers.Line 51Total Tax. Include in the totalon line 51 any of the following taxes. Tofind out if you owe the tax, see the formor publication indicated. On the dotted linenext to line 51, enter the amount of the taxand identify it as indicated.

Recapture of the following credits.q Investment credit (see Form 4255).Identify as ICR.q Low-income housing credit (see Form8611). Identify as LIHCR.q Qualified electric vehicle credit (seePub. 535). Identify as QEVCR.q Indian employment credit. Identify asIECR.

Recapture of Federal MortgageSubsidy. If you sold your home in 1997and it was financed (in whole or in part)from the proceeds of any tax-exemptqualified mortgage bond or you claimedthe mortgage interest credit, see Form8828. Identify as FMSR.

Section 72(m)(5) Excess BenefitsTax (see Pub. 560). Identify as Sec.

72(m)(5).Uncollected Employee Social

Security and Medicare or RRTA Tax onTips or Group-Term Life Insurance.This tax should be shown in box 13 ofyour Form W-2 with codes A and B or Mand N. Identify as UT.

Golden Parachute Payments. If youreceived an excess parachute payment(EPP), you must pay a 20% tax on it. Thistax should be shown in box 13 of yourW-2 form with code K. If you received aForm 1099-MISC, the tax is 20% of theEPP shown on that form. Identify asEPP.

Tax on Accumulation Distribution ofTrusts. Enter the amount from Form4970 and identify as ADT.

PaymentsLine 52Federal Income Tax Withheld.Add the amounts shown as Federalincome tax withheld on your Forms W-2,W-2G, and 1099-R. Enter the total on line52. The amount of Federal income taxwithheld should be shown in box 2 ofForm W-2 or W-2G, and in box 4 of Form1099-R. If line 52 includes amountswithheld as shown on Form 1099-R,attach the Form 1099-R. Also, include in

the total for line 52 any tax withheld onscholarship or fellowship grants fromForm 1042-S.

If you received a 1997 Form 1099showing Federal income tax withheld ondividends, interest income, or otherincome you received, include the amountwithheld in the total on line 52. Thisshould be shown in box 2 of Form1099-DIV and box 4 of the other 1099forms.



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Line 531997 Estimated TaxPayments. Enter any payments youmade on your estimated Federal incometax (Form 1040-ES (NR)) for 1997.Include any overpayment from your 1996return that you applied to your 1997estimated tax.

Name Change. If you changed yourname because of marriage, divorce, etc.,and you made estimated tax paymentsusing your former name, attach astatement to the front of Form 1040NR

explaining all the payments you made in1997 and the name and SSN or ITINunder which you made the payments.Line 54Amount Paid With Form 4868(Request for Extension). If you filedForm 4868 to get an automatic extensionof time to file Form 1040NR, enter anyamount you paid with that form. Also,include any amounts paid with Form2688.Line 55Excess Social Security andRRTA Tax Withheld. If you had morethan one employer for 1997 and your totalwages were over $65,400, too muchsocial security tax may have beenwithheld. If you had more than onerailroad employer for 1997 and your totalcompensation was over $48,600, toomuch railroad retirement (RRTA) tax mayhave been withheld. For details, includinghow to figure the amount to enter on line55, see Pub. 505, Tax Withholding andEstimated Tax.Line 56Other Payments. Check thebox(es) on line 56 to report any creditfrom Form 2439, Notice to Shareholderof Undistributed Long-Term CapitalGains, or Form 4136, Credit for FederalTax Paid on Fuels.Line 57Credit for Amount Paid WithForm 1040-C. Enter any amount you

paid with Form 1040-C for 1997.Lines 58a and 58bU.S. Tax Withheldat Source. Enter on line 58a the amountyou show on line 76. Enter on line 58bany tax withheld by a partnership undersection 1446. Be sure to attach a copy ofForm(s) 1042-S, SSA-1042S,RRB-1042S, 8805, or similar form.Lines 59a and 59bU.S. Tax Withheldon Dispositions of U.S. Real PropertyInterests. Enter on line 59a any taxwithheld on dispositions of U.S. realproperty interests from Form(s) 8288-A.Enter on line 59b any tax withheld ondispositions of U.S. real property interestsfrom Form(s) 1042-S.

RefundLine 61Amount Overpaid. If line 61is under $1, we will send a refund only onwritten request.Tip: If the amount you overpaid is large,you may want to decrease the amount ofincome tax withheld from your pay. See1998 Income Tax Withholding and

AccountNumber

(line 62d)

RoutingNumber

1234

SAMPLE

PAUL MAPLELILIAN MAPLE123 Main StreetAnyplace, NY 10000

15-0000/0000

PAY TO THEORDER OF

19

$

DOLLARS

ANYPLACE BANKAnyplace, NY 10000

For

|:250250025|:202020"86". 1234

Note: The routing and account numbers may appear in different places on your check.

(line

Documents

US Internal Revenue Service: i1040nr--1997