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2006 Form 1-NR/PY Instructions — Schedule Instructions

◗ Dividends. Where a taxpayer receives a dividend

in 2005. The deduction is available to single tax-

10. Enter any amount of home heating fuel de-

payers with adjusted gross income of $50,000 or

that must be repaid in a later year (e.g., because it

duction taken last year, from 2005 Schedule Y,

less and to joint filers and heads of household with

impaired corporate capital), the dividend must be

line 14 . . . . . . . . . . . . . . . . . . . . . . .

adjusted gross income of $75,000 or less. A qual-

included in the year of receipt;

11. Add lines 9 and 10. If $800 or less, enter the

ifying taxpayer who did not take the full $800 de-

◗ Corporate notes. Where a taxpayer receives a

amount from line 9 in Schedule Y, line 14. If

duction in 2005 may take the remainder in 2006

greater than $800, go to line 12 . . .

distribution with respect to holding of notes, the

for purchases made between January 1, 2006 and

12. Enter $800. . . . . . . . . . . . . . . . .

income must be included regardless of whether it

March 31, 2006. Complete the Schedule Y, line 14

13. Subtract line 12 from line 11. . .

could be challenged by senior creditors;

worksheet to calculate the amount of the home

14. Subtract line 13 from line 9. Enter result

◗ Mistake in validity of claim. The claim of right

heating fuel deduction. Special rules apply for rent-

here and in Schedule Y, line 14 . . . .

doctrine applies where a taxpayer merely mistakes

ers and owners of condominiums and cooperative

Note: Go to line 15 if your home heating fuel

the validity of his claim; or

dwellings. See TIR 05-18, available at

deduction in Schedule Y, line 14 (line 11 or line

◗ Advanced insurance commissions.

gov/dor, for more information.

14 of worksheet) is more than the amount of

5.3% income after deductions in line 3. The

If you are entitled to claim this deduction, enter the

Schedule Y, Line 14 — Home Heating Fuel

excess may be applied against all your interest

amount claimed in Schedule Y, line 15. For more

Deduction (Only if Single, Head of Household,

and dividend income and income taxed at 12%.

information, see TIR 06-4.

or Married Filing Jointly)

Any remaining excess amount may then be

1. Enter your total 5.3% income from Form

applied against your long-term capital gain

Line 16. Commuter Deduction

1-NR/PY, line 12. Not less than “0” *

income. Complete the Schedule B, Line 36 and

A deduction is allowed for certain amounts paid by

2. Enter the total of Schedule Y, lines 1

Schedule D, line 19 Worksheet on page 17 to

an individual for tolls paid for through a FastLane

through 10. . . . . . . . . . . . . . . . . . . .

calculate the excess deduction amount.

account or for weekly or monthly transit commuter

3. Subtract line 2 from line 1. Not less

15. Excess home heating fuel deduction. Sub-

passes for MBTA transit or commuter rail, not in-

than “0” . . . . . . . . . . . . . . . . . . . . . .

tract line 3 from the amount entered in Schedule

cluding amounts reimbursed or otherwise deduct-

4. Enter total Massachusetts bank interest or

Y, line 14 (line 11 or line 14 of worksheet).

ible. In the case of a single person or a married

the interest exemption amount, whichever

Enter here and in line 3 of the Schedule B,

person filing a separate return or a head of house-

is smaller, from Form 1-NR/PY, line 7a or

Line 36 and Schedule D, Line 19 Worksheet

hold filing a separate return, this deduction applies

line 7b . . . . . . . . . . . . . . . . . . . . . . .

on page 17 . . . . . . . . . . . . . . . . . . .

only to the portion of such expended amount that

Note: If Form 1-NR/PY, line 12 is a loss, do not

exceeds $150, and the total amount deducted can-

* Add back any Abandoned Building Renovation

complete line 4 above. Instead, combine Form

not exceed $750. In the case of a married couple fil-

deduction claimed on Schedule(s) C and/or E

1-NR/PY, line 12 with the smaller amount of

before entering an amount in line 1.

ing a joint return, this deduction applies only to the

total Massachusetts bank interest or the interest

portion of such amount expended by each individual

** If filing Schedule D-IS, Installment Sales, see

exemption amount. Enter the result in line 4

that exceeds $150, and the total amount deducted

the Schedule D-IS instructions for the amount

above, unless the result is a loss. If the result

cannot exceed $750 for each individual. Also, one

to enter in line 6. Schedule D-IS and instruc-

is a loss, enter “0.”

spouse cannot transfer his or her excess deduction

tions are available on DOR’s website at

5. Enter amount from Schedule B, line 35. If

to the other spouse; separate worksheets must be

gov/dor.

there is no entry in Schedule B, line 35 or if

completed to calculate the deduction. See TIR 06-14

not filing Schedule B, enter the amount from

for additional information. Complete the worksheet

Line 15. Claim of Right Deduction

Form 1-NR/PY, line 24 . . . . . . . . . .

below to calculate the commuter deduction.

For tax years beginning on or after January 1, 2005,

6. Enter the amount from Schedule D, line 18. **

taxpayers who have paid Massachusetts personal

Not less than “0” . . . . . . . . . . . . . . .

Schedule Y, Line 16 Worksheet —

income taxes in a prior year on income attributed

7. Part-year residents, enter the amount of in-

Commuter Deduction

come received while you were not a resident of

to them under a “claim of right” may deduct the

1. Enter amount paid in 2006 for tolls through

Massachusetts; nonresidents, enter the amount

amount of that income from their gross income if it

a FastLane account . . . . . . . . . . . . .

from line 14e of Form 1-NR/PY. . . .

later develops that they were not in fact entitled to

2. Enter amount paid in 2006 for weekly or

8. Add lines 3 through 7 . . . . . . . . .

the income, and have repaid the amounts in ques-

monthly transit commuter passes for MBTA

tion. The deduction is allowed in the year of repay-

If you are single and the total in line 8 is $50,000

transit or commuter rail. (do not include amounts

ment, provided that the repayment is not otherwise

or less, or if you are filing as head of household

reimbursed or otherwise deductible)

deductible in determining Massachusetts income

or married filing a joint return, and the total in line

3. Add lines 1 and 2. If $150 or less, you do not

taxable under M.G.L. ch. 62. Some examples in

8 is $75,000 or less, you qualify for the Home

qualify for this deduction. Omit remainder of

Heating Fuel deduction. Go to line 9. Otherwise,

which the claim of right may be applied for are:

this worksheet. Otherwise, complete lines 4

you are not eligible for this deduction.

◗ Stock under claim of ownership. Gains from

through 7 . . . . . . . . . . . . . . . . . . . . .

9. Part-year residents, enter the amount paid

4. Enter $150 . . . . . . . . . . . . . . . . .

sales of stock under a claim of ownership must be

for home heating oil, natural gas or propane

5. Subtract line 4 from line 3 . . . . . .

included, regardless of whether the taxpayer actu-

purchased while a resident between January 1,

6. Enter the lesser of line 5 or $750

ally owned it;

2006 and March 31, 2006 or $800, whichever

7. Part-year residents, multiply line 6 by Form

◗ Employment contracts. Amounts in settlement

is less. Nonresidents, multiply the lesser of the

1-NR/PY, line 2. Enter the result here and in line

of employment contracts must be included not-

amount paid for home heating oil, natural gas

16 on Schedule Y. Nonresidents, multiply line 6

withstanding the prospect of eventual repayment

or propane purchases between January 1, 2006

by Form 1-NR/PY, line 14g. Enter the result here

to the employer of an amount equivalent to or

and March 31, 2006 or $800 by Form 1-NR/PY,

and in line 16 on Schedule Y . . . . . .

greater than the amount received;

line 14g and enter the result here . . .

Instructions For Form 1-Nr/py - Massachusetts Nonresident Or Part-Year Resident Income Tax - 2006 Page 25

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