Instructions For Form 1 - Massachusetts Resident Income Tax

2006 Form 1 — Schedule Instructions

◗ If you choose to pay the optional 5.85% tax

The credit allowed for installation of qualifying pur-

Part 2 Credits for Residents and

chases in any one residential building is 30% of

rate, substitute .0585 for .053 in line 4 of the

Part-Year Residents Only

the cost; however, the credit cannot exceed $600

worksheet.

Line 12. Income Tax Paid to

for a residential dwelling or $1,000 for a multi-unit

Note: Be sure to enter the two-letter state or ju-

Another State

dwelling. Joint owners of a residential property

risdictional postal code for each state or juris-

share any credit available to the property in the

If any of the income reported on this return is sub-

diction for which you are taking the credit. Visit

same proportion as their ownership interest. The

ject to taxation in another state or jurisdiction and

the United States Postal Service’s website at

credit allowed under this section may be taken in

you have filed a return and paid taxes in the other

and click on “Service Guides”

2005 or 2006, regardless of the exact date on

state or jurisdiction, complete the Schedule Z, Part

for a list of these codes.

which any qualifying purchases were made. The

2, line 12 worksheet and enter the amount of credit

amount of credit that exceeds the total tax due for

line 12. Do not include taxes paid to the U.S. gov-

Schedule Z, Part 2, Line 12 Worksheet —

2005 may be carried over, as reduced, and applied

ernment. (This credit does not apply to city or local

Income Tax Paid to Another Jurisdiction

against the tax liability for 2006. For more informa-

taxes.) You are allowed to claim a credit for taxes

Note: If you have income other than from

tion, see TIR 05-18. If you qualify for this credit,

paid to the following jurisdictions: (a) other states in

Form 1, line 10 taxed by other jurisdictions,

complete Massachusetts Schedule HEEC, Home

the U.S.; (b) any territory or dependency of the U.S.

see instructions.

Energy Efficiency Credit, and enter the amount of

(including Puerto Rico, the Virgin Islands, Guam,

1. Enter the total 5.3% income included in

credit in line 8.

the District of Columbia); or (c) the Dominion of

Form 1, line 10 on which you paid taxes

Canada or any of its provinces (less any U.S. credit

to another jurisdiction . . . . . . . . . . .

Line 9. Film Incentive

amount allowable from U.S. Form 1116).

2. Enter the total of Form 1, line 10 and the total

For tax years beginning on or after January 1,

The total credit which you calculate on this

Massachusetts bank interest or the interest

2006 and before January 1, 2013, motion picture

worksheet is the smaller of the amount of taxes

exemption amount, whichever is smaller,

production companies may claim (1) a credit equal

due to other jurisdictions (net of certain adjust-

from Form 1, line 5a or line 5b . . . .

to 20% of the total qualifying aggregate payroll for

3. Divide line 1 by line 2 . . . . . . . . .

ments) or the portion of your Massachusetts tax

employing persons within the Commonwealth in

4. Multiply Form 1, line 19 by .053

due on your gross income that is taxed in such

connection with the filming and production of a

5. Enter any Limited Income Credit from

other jurisdictions.

motion picture and (2) a credit equal to 25% of their

Form 1, line 28 . . . . . . . . . . . . . . . .

Credit is not given for a property tax due to an-

Massachusetts production expenses. Each credit

6. Subtract line 5 from line 4 . . . . . .

other jurisdiction on account of capital stock or

has its own qualification requirements and a tax-

7. Multiply line 6 by line 3 . . . . . . . .

property. This does not refer to a tax on gain or

payer is allowed to qualify for and claim both

8. Enter the total tax paid to other jurisdictions

income from the sale of capital stock or property,

credits. However, the total amount of tax credits

on income also reported on this return unless

as included on Schedule B or D. Credit is also not

allowed for any one motion picture may not ex-

the tax was paid to Canada. If the tax was paid to

given for any interest and penalties paid on a tax

ceed $7,000,000. The credits are also transferable.

Canada, the amount reported in this line must be

due to another jurisdiction.

For more information, see TIR 06-1. If you qualify

reduced by the amount claimed as a foreign tax

for this credit, enter the amount of credit in line 9.

credit on U.S. Form 1040, line 47. Credit is only

You must complete separate worksheets if you had

Also, be sure to enter the DOR-issued certificate

allowable for amount of tax paid . . .

5.3% and interest income (other than interest from

9. Enter the smaller of lines 7 or 8 here and on

number in the space provided on line 9. Certificate

Massachusetts banks), dividends or capital gain in-

Schedule Z, line 12 . . . . . . . . . . . . .

application forms and additional information are

come taxed by another jurisdiction. If you use this

available at

worksheet to calculate a credit for interest income

Line 13. Energy

(other than interest from Massachusetts banks),

Line 10. Medical Device

If you had expenditures for certain renewable en-

dividends or capital gain income, substitute inter-

For tax years beginning on or after January 1,

ergy source items, such as equipment which uses

est income (other than interest from Massachu-

2006, medical device companies that develop or

or transmits solar or wind energy to heat, cool, or

setts banks), dividends or capital gain income for

manufacture medical devices in Massachusetts can

provide hot water for your principal residence in

5.3% income in line 1. You must also substitute

claim a credit equal to 100% of the user fees paid

Massachusetts, you may qualify for a credit. If you

Schedule B, line 7 (interest and dividend income)

by them when submitting certain medical device

qualify for the credit, complete Schedule EC, Res-

and Schedule B, line 13 (taxable 12% capital gains)

applications and supplements to the United States

idential Energy Credit, and enter the amount of

or Schedule D, line 12, (gross long-term capital

Food and Drug Administration. The credit is also

credit in line 13.

gains and losses), but not less than “0,” for Form

transferable. For more information, see TIR 06-22.

1, line 10 in line 2 of the worksheet, and the total of

Line 14. Totals

If you qualify for this credit, enter the amount of

Form 1, line 20 multiplied by .053 (tax on interest

credit in line 10. Also, be sure to enter the DOR-

Add lines 12 and 13.

and dividend income) and Form 1, line 23 (12%

issued certificate number in the space provided on

tax) or line 24 (tax on long-term capital gains) for

Line 15. Total Credits

line 10. Certificate application forms and additional

Form 1, line 19 in line 4 of the worksheet.

information are available at

Add lines 11 and 14. Enter the result here and in

◗ When using this worksheet to calculate credit

Form 1, line 29.

Line 11. Total Part 1 Credits

for interest income (other than interest from

Massachusetts banks), dividends or capital gain

Add lines 1 through 10 and enter the result in line

income, enter in line 1 such income taxed in an-

11. Also, complete lines 12 through 15.

other jurisdiction calculated as if it was earned in

Massachusetts.

Instructions For Form 1 - Massachusetts Resident Income Tax - 2006 Page 22

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