[net.taxes] Income Averaging Flowchart

miorelli (12/13/82)

         INDIVIDUALS ELIGIBLE TO USE INCOME AVERAGING


computation year (def) - the tax year for this return, i.e. 1982 for
       returns due 4/15/83
base years (def) - the four years immediately preceding the computation
       year, i.e 78, 79, 80, 81 for a 1982 computation year
AGI (def) - Adjusted Gross Income: the last line on page 1 of the 1040.


                    +------------------------------+
                    | Were you a U.S. citizen or   |
                    | resident alien in all the    |     No
                    | base years and in the comp-  |------------+
                    | utation year?                |            |
                    +------------------------------+            |
                                    | Yes                       |
                                    |                           |
                                    V                           |
                    +------------------------------+            |
            Yes     | Did you furnish at least 50% |            |
        +-----------| of your own support in each  |            |
        |           | of the base years?           |            |
        |           +------------------------------+            |
        |                           | No                        |
        |                           |                           |
        V                           V                           V
+------------------+    +-----------------------+    +----------------------+
| You may income   |    |  Are you 25 or older? |    | You man not income   |
| average (Sch G)  |    +-----------------------+    | average (sorry)      |
+------------------+        /             \          +----------------------+
        ^                  / Yes       No  \                    ^
        |                 /                 \                   |
        |                /                   \                  |
        |        +---------------+  +------------------+        |
        |        | In how many   |  | Is more than half|        |
        |        | years since   |  | of your taxable  |        |
        |  4 or  | the year in   |  | income for the   |        |
        |<-------| which you be- |  | current year from|        |
        |  more  | came 21 were  |  | work which was   |        |
        |        | you not a     |  | primarily per-   |        |
        |        | student?      |  | formed in two or |        |
        |        +---------------+  | more of the base |        |
        |               |           | years?           |        |
        |               |           +------------------+        |
        |               |               ^   |      |            |
        |               |  less than 4  |   |      | No         |
        |               +---------------+   |      |            |
        |   Yes                             |      |            |
        |<----------------------------------+      |            |
        |                                          V            |
        |                            +----------------------+   |
        |                            | Are you married      |No |
        |                            | filing jointly with  |-->|
        |                            | your spouse?         |   |
        |                            +----------------------+   |
        |                                          | Yes        |
        |                                          |            |
        |                                          V            |
        |                            +----------------------+   |
        |                            | Is your income 25% or|   |
        |               Yes          | less of the combined |No |
        +---<------------------------| AGI of you and your  |-->+
                                     | spouse?              |
                                     +----------------------+