Department of the Treasury
Internal Revenue Service
1992 Instructions for Schedule R (Form 1040)
Use Schedule R to figure the credit for the elderly or the disabled.
Credit for the Additional Information. Get Pub. 524, Credit for the Elderly or the Disabled, for
more details.
Elderly or the
Disabled
disabled to take the credit. A person is Example 3 shows a person who might
permanently and totally disabled if both not be considered engaged in a substan-
Who Can Take the of the following apply: tial gainful activity.
1. He or she cannot engage in any sub- Example 3. John, who retired on dis-
Credit stantial gainful activity because of a phys- ability, took a job with a former employer
The credit is based on your filing status, ical or mental condition, and on a trial basis. The purpose of the job
age, and income. If you are married filing 2. A physician determines that the condi- was to see if John could do the work. The
a joint return, it is also based on your tion has lasted or can be expected to last trial period lasted for some time during
spouse’s age and income. continuously for at least a year or can lead which John was paid at a rate equal to the
You may be able to take the credit for to death. minimum wage. But because of John’s
1992 if either of the following applies: Examples 1 and 2 below show situa- disability, only light duties of a nonproduc-
● You were age 65 or older at the end of tions in which the individuals are consid- tive, make-work nature were given him.
1992, OR ered engaged in a substantial gainful Unless the activity is both substantial and
gainful, John is not engaged in a substan-
● You were under age 65 at the end of activity. Note: In each example, the
person was under age 65 at the end of the tial gainful activity. The activity was gainful
1992 and you meet all three of the follow-
year. because John was paid at a rate at or
ing:
Example 1. Sue retired on disability as above the minimum wage. However, the
1. You were permanently and totally dis- activity was not substantial because the
abled on the date you retired; or if you a sales clerk. She now works as a full-time
babysitter at the minimum wage. Although duties were of a nonproductive, make-
retired before January 1, 1977, you were work nature. More facts are needed to es-
permanently and totally disabled on Jan- she does different work, Sue babysits on
ordinary terms for the minimum wage. She tablish John’s ability to engage in a
uary 1, 1976, or January 1, 1977; and substantial gainful activity.
2. You received taxable disability income cannot take the credit.
Example 2. Mary, the president of XYZ Disability Income. Generally, disability
for 1992; and income is the total amount you were paid
3. On January 1, 1992, you had not Corporation, retired on disability because
of her terminal illness. On her doctor’s under your employer’s accident and
reached mandatory retirement age (the health plan or pension plan that is includ-
age when your employer’s retirement pro- advice, she works part-time as a manager
and is paid more than the minimum wage. ed in your income as wages or payments
gram would have required you to retire). in lieu of wages for the time you were
Her employer sets her days and hours.
For the definition of permanent and total absent from work because of permanent
Although Mary’s illness is terminal and she
disability, see What Is Permanent and and total disability. However, any payment
works part-time, the work is done at her
Total Disability? below. Also, see the in- you received from a plan that does not
employer’s convenience. Mary is consid-
structions for Part II. provide for disability retirement is not dis-
ered engaged in a substantial gainful ac-
Married Persons. If you were married at tivity and cannot take the credit.
the end of 1992, generally you must file a
joint return to take the credit. But if your Income Limits for Credit for the Elderly or the Disabled
filing status on Form 1040 is married filing
a separate return, you may take the credit If you are: You generally cannot take the credit if:
only if you lived apart from your spouse
ALL year. Single, Head of household, or The amount on Form 1040, line 32, is
Qualifying widow(er) $17,500 or more; or you received $5,000
Nonresident Aliens. If you were a non- or more of nontaxable social security or
resident alien at any time during 1992, you other nontaxable pensions
may be able to take the credit only if you
were married to a U.S. citizen or resident Married filing a joint return and The amount on Form 1040, line 32, is
alien at the end of 1992, and you and your only one spouse is eligible for $20,000 or more; or you received $5,000
spouse elect to file a joint return. the credit or more of nontaxable social security or
Income Limits. Generally, you cannot other nontaxable pensions
take the credit if your income is equal to
or more than a certain dollar amount. See Married filing a joint return and The amount on Form 1040, line 32, is
the chart on this page for details. both spouses are eligible for $25,000 or more; or you received $7,500
the credit or more of nontaxable social security or
What Is Permanent and Total Disability? other nontaxable pensions
If you were under age 65 at the end of
1992, you must be permanently and totally Married filing a separate The amount on Form 1040, line 32, is
return and you did not live $12,500 or more; or you received $3,750
with your spouse all year or more of nontaxable social security or
other nontaxable pensions
Cat. No. 11357O
ability income. In figuring the credit, dis- were unable to engage in any substantial fits, treat the workers’ compensation ben-
ability income does not include any gainful activity during 1992 because of efits as social security benefits when
amount you received from your employ- your physical or mental condition. If you completing Schedule R, line 13a.
er’s pension plan after you have reached checked box 4, 5, or 6 in Part I, write in Line 13b. Enter the total of the following
mandatory retirement age. For more de- the space above the box on line 2 in Part types of income that you (and your spouse
tails on disability income, get Pub. 525, II the first name(s) of the spouse(s) for if filing a joint return) received for 1992:
Taxable and Nontaxable Income. whom the box is checked. ● Veterans’ pensions (but not military dis-
If the Department of Veterans Affairs ability pensions).
(VA) certifies that you are permanently and ● Any other pension, annuity, or disability
How To Figure the totally disabled, you can file VA Form benefit that is excluded from income
21-0172 instead of the physician’s state-
Credit ment. VA Form 21-0172 must be signed
under any provision of Federal law other
than the Internal Revenue Code. Do not
If you want, we will figure the credit for by a person authorized by the VA to do include amounts that are treated as a
you in most cases. For more details, see so. You can get this form from your local return of your cost of a pension or annuity.
the Form 1040 instructions on page 23 VA regional office.
Do not include on line 13b any pension,
under The IRS Will Figure Your Tax and annuity, or similar allowance for personal
Some of Your Credits. Part III. Figure Your injuries or sickness resulting from active
If you figure the credit yourself, first fill service in the armed forces of any country,
in Form 1040 through line 41. Then, read Credit or in the Coast and Geodetic Survey or
the following instructions. Line 11. If you checked box 2, 4, 5, 6, or the Public Health Service, or as a disability
9 in Part I, complete line 11 as follows: annuity payable under section 808 of the
Part I. Filing Status and ● If you checked box 6, add $5,000 to the Foreign Service Act of 1980.
amount of disability income you reported Line 21. You may not be able to take the
Age on Form 1040 for the spouse who was full amount of the credit you figured on
Check the box for your filing status and under age 65. Enter the total on line 11. line 21 if both 1 and 2 below apply:
age. Check only one box. In general, the ● If you checked box 2, 4, or 9, enter on 1. You file Schedule C, C-EZ, D, E, or F
largest amount you can use to figure the line 11 the total amount of disability (Form 1040), and
credit is based on your filing status and income you reported on Form 1040. 2. The amount on Form 1040, line 23, is
age. If you are filing a joint return, it is also ● If you checked box 5, enter on line 11 more than:
based on your spouse’s age. the total amount of disability income for — $30,000 if single or head of house-
both you and your spouse that you report- hold,
Part II. Statement of ed on Form 1040. — $40,000 if married filing jointly or qual-
Example 1. Bill, age 63, retired on per- ifying widow(er), or
Permanent and Total manent and total disability in 1992. He — $20,000 if married filing separately.
Disability received $4,000 of taxable disability
income that he reported on Form 1040, Note: For purposes of 2 above, any tax-
If you checked box 2, 4, 5, 6, or 9 in Part line 7. He filed a joint return with his wife exempt interest from private activity bonds
I and you did not file a physician’s state- who was age 67 in 1992. On line 11, Bill issued after August 7, 1986, and any net
ment for 1983 or an earlier year, or you enters $9,000 ($5,000 plus the $4,000 of operating loss deduction must be added
filed a statement for tax years after 1983 disability income he reported on Form to the amount from Form 1040, line 23.
and your physician signed on line A of the 1040). If both 1 and 2 above do not apply,
statement, you must have your physician Example 2. John checked box 2 in Part enter on Form 1040, line 42, the amount
complete a statement certifying that: I and enters $5,000 on line 10. He received from Schedule R, line 21. If both 1 and 2
● You were permanently and totally disa- $3,000 of taxable disability income, which above do apply, get Form 6251, Alterna-
bled on the date you retired, or he enters on line 11. John also enters tive Minimum Tax—Individuals, and com-
● If you retired before January 1, 1977, $3,000 on line 12 (the smaller of line 10 or plete it through line 18. Then, figure the
you were permanently and totally disabled line 11). The largest amount he can use to amount of credit you may take as follows:
on January 1, 1976, or January 1, 1977. figure the credit is $3,000. 1. Enter the amount from
You must attach this statement to Form Lines 13a through 18. The amount on Form 1040, line 40, minus
1040. You may use the physician’s state- which you figure your credit may be re- any dependent care
ment in Part II for this purpose. Your phy- duced if you received certain types of non- credit on Form 1040, line
sician should show on the statement if the taxable pensions and annuities, OR if your 41 1.
disability has lasted or can be expected adjusted gross income on Form 1040, line 2. Enter the amount from
to last continuously for at least a year, or 32, is more than a certain dollar amount, Form 6251, line 18 2.
if there is no reasonable probability that depending on which box you checked in 3. Maximum credit. Sub-
the disabled condition will ever improve. Part I. Complete lines 13a through 18 as tract line 2 from line 1. If
If you file a joint return and you checked applicable. zero or less, enter -0- 3.
box 5 in Part I, you and your spouse must Line 13a. Enter any social security ben- 4. Enter the credit you first
each file a statement. If both you and your efits (before deduction of Medicare premi- figured on Schedule R,
spouse use the statement in Part II, attach ums) you (and your spouse if filing a joint line 21 4.
a separate Schedule R for your spouse return) received for 1992 that are not tax-
with only Part II filled in. Keep copies of Look at lines 3 and 4 above. Enter the
able. Also, enter any tier 1 railroad retire- smaller of the two amounts on Form
these statements with your tax records. ment benefits treated as social security 1040, line 42. If line 3 is the smaller
If you filed a physician’s statement for that are not taxable. amount, also write “AMT” on the dotted
1983 or an earlier year, or you filed a state- If any of your social security or equiva- line next to line 42 and replace the amount
ment for tax years after 1983 and your lent railroad retirement benefits are taxa- on Schedule R, line 21, with that amount.
physician signed on line B of the state- ble, the amount to enter on this line is
ment, you do not have to attach another generally the difference between the
statement for 1992. But you must check amounts entered on Form 1040, line 21a
the box on line 2 in Part II to certify that and line 21b.
(1) you filed a physician’s statement in an Note: If your social security or equivalent
earlier year, (2) you were permanently and railroad retirement benefits are reduced
totally disabled during 1992, and (3) you because of workers’ compensation bene-
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