Looking for a Kentucky Income Tax Forms And Templates? Download it for free!

Instructions for Schedule M—Modifications to Federal Adjusted Gross Income

•

Additions to Federal Adjusted Gross Income

any mortgage debt forgiven under the Mortgage

Forgiveness Debt Relief Act of 2007;

Line 1—Interest on securities issued by other states and

•

their political subdivisions is taxed by Kentucky and must

the passive activity loss adjustment (see Form 8582-K and

be reported. Also report dividends received from regulated

instructions);

investment companies (mutual funds) that are taxable for

•

differences in pension (3-year recovery rule) and IRA

Kentucky income tax purposes. Note: Interest from securities

bases;

of Kentucky and its political subdivisions is exempt.

•

differences in gains (losses) from the sale of intangible

Line 2—Enter the self-employed health insurance deduction

assets amortized under the provisions of the Revenue

from federal Form 1040, Line 29.

Reconciliation Act of 1993; and

Line 3—Enter resident adjustment from Kentucky Schedule

•

differences in gains (losses) from the sale of depreciable

K-1. Partners, beneficiaries of estates and trusts and S

property placed in service after September 10, 2001.

corporation shareholders, see Kentucky Schedule K-1

Note: Before entering the difference on Line 7 you must take

instructions.

into account any addition or subtraction affecting the at–risk

Line 4—Enter total depreciation from federal Form 4562

limitations. See instructions for Line 19.

if you have elected to take the 30 percent or 50 percent

special depreciation allowance or the increased Section 179

Line 8, Total Additions—Add Lines 1 through 7. Enter on

deduction for property placed in service after September 10,

Line 8 and on Form 740, page 1, Line 6.

2001. See Line 16 for additional instructions.

Line 5—Enter federal net operating loss reported on Line 21

Subtractions from Federal Adjusted Gross Income

of 2011 federal Form 1040.

Line 9—Enter the amount of taxable state income tax refund

Line 6—Enter federal domestic production activities deduction

from federal Form 8903, line 25.

or credit reported on your federal return and included as

income on Form 740, page 1, Line 5.

Line 7—Enter other additions to federal adjusted gross

income not listed above (attach detailed schedule).

Line 10—Enter interest income from U.S. government

Include:

bonds and securities. Do not include taxable interest from

•

securities, such as FNMA (Fannie Mae), GNMA (Ginnie Mae)

the portion of a lump-sum distribution on which you have

and FHLMC (Freddie Mac), which are merely guaranteed by

elected the 20 percent capital gains rate for federal income

the U.S. government.

tax purposes (Schedule P and Form 4972-K required);

Line 11, Pension Income Exclusion—The 2011 exclusion amount is 100 percent of taxable retirement benefits or $41,110, whichever

is less. All pension and retirement income paid under a written retirement plan (qualified or unqualified) is eligible for exclusion.

This includes pensions, annuities, IRA accounts, 401(k) and similar deferred compensation plans, income received from convert-

ing a regular IRA to a Roth IRA, death benefits, disability retirement benefits and other similar accounts or plans.

This exclusion is for each taxpayer and must be computed independently of your spouse who may be filing on the same return. A

husband and wife must complete and claim their own exclusion, regardless of filing status. Joint filers—Combine the separately

computed pension exclusion amounts and enter on Schedule M, Line 11, Column B.

Pension Income Exclusion Worksheet

Column A

Column B

Step 1.

Spouse

Yourself

a. Enter taxable pension income reported on your federal Form 1040,

Line 15(b) or 16(b); Form 1040A, Line 11(b) or 12(b) .................................................. a

b. Enter disability retirement benefits on Form 1040, Line 7 or

Form 1040A, Line 7 ....................................................................................................... b

c. Enter deferred compensation reported on Form 1040, Line 7 or

Form 1040A, Line 7 ....................................................................................................... c

d. Add Lines a, b and c ..................................................................................................... d

Step 2. Line d is $41,110 or less. Enter the amount from Line d on Schedule M, Line 11.

Step 3. Line d is more than $41,110. Do you have retirement income from the

federal government, the Commonwealth of Kentucky or a Kentucky local



government; or supplemental U.S. Railroad Retirement Board benefits?.........................

Yes

If you answered no, enter $41,110 on Schedule M, Line 11.

If you answered yes, you must complete Schedule P to determine your pension

exclusion.

Instructions For Forms 740 And 740-Ez - Kentucky Individual Income Tax Return - 2011 Page 18

Related Articles

Related forms

Related Categories