U.S. Individual Income Tax Return

Department of the Treasury
Internal Revenue Service

2012 Instructions for Schedule R
(Form 1040A or 1040)
Credit for the
Elderly or the
Disabled

Use Schedule R (Form 1040A or 1040) to figure the credit for the elderly or the disabled.
Future Developments. For the latest information about developments
related to Schedule R (Form 1040A or Form 1040) and it's instructions,
such as legislation enacted after they were published, go to
www.irs.gov/form1040.
Additional information. See Pub. 524 for more details.

Nonresident Aliens

Who Can Take the Credit
The credit is based on your filing status, age, and income. If you are married filing a joint return, it is also based on your spouse's age and income. You may
be able to take this credit if either of the following
applies.
1. You were age 65 or older at the end of 2012, or
2. You were under age 65 at the end of 2012 and
you meet all of the following.
a. You were permanently and totally disabled on
the date you retired. If you retired before 1977, you
must have been permanently and totally disabled on
January 1, 1976, or January 1, 1977.
b. You received taxable disability income for
2012.
c. On January 1, 2012, you had not reached mandatory retirement age (the age when your employer's
retirement program would have required you to retire).
For the definition of permanent and total disability, see What Is Permanent and Total Disability?, later. Also, see the instructions for Part II.

Age 65
You are considered age 65 on the day before your
65th birthday. As a result, if you were born on January 1, 1948, you are considered to be age 65 at the
end of 2012.

Married Persons Filing Separate
Returns
If your filing status is married filing separately and
you lived with your spouse at any time during 2012,
you cannot take the credit.

If you were a nonresident alien at any time during
2012, you may be able to take the credit only if your
filing status is married filing jointly.

Income Limits
See Income Limits for the Elderly or the Disabled,
later.

Want the IRS To Figure Your Credit?
If you can take the credit and you want us to figure it
for you, check the box in Part I of Schedule R (Form
1040A or 1040) for your filing status and age. Fill in
Part II and lines 11 and 13 of Part III if they apply to
you. If you file Form 1040A, enter “CFE” in the
space to the left of Form 1040A, line 30. If you file
Form 1040, check box c on Form 1040, line 53, and
enter “CFE” on the line next to that box. Attach
Schedule R (Form 1040A or 1040) to your return.

What Is Permanent and Total
Disability?
A person is permanently and totally disabled if both
1 and 2 below apply.
1. He or she cannot engage in any substantial
gainful activity because of a physical or mental condition.
2. A qualified physician determines that the condition has lasted or can be expected to last continuously for at least a year or can lead to death.
Examples 1 and 2, next, show situations in which
the individuals are considered engaged in a substantial gainful activity. Example 3 shows a person who
might not be considered engaged in a substantial
gainful activity. In each example, the person was under age 65 at the end of the year.

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Income Limits for the Credit for the Elderly or the Disabled
THEN you generally cannot take the credit if:

IF you are . . .

The amount on Form 1040A,
line 22, or
Form 1040, line 38, is . . .

Or you received . . .

Single, head of household, or qualifying
widow(er) with dependent child

$17,500 or more

$5,000 or more of nontaxable social
security or other nontaxable pensions,
annuities, or disability income

Married filing jointly and only one spouse
is eligible for the credit

$20,000 or more

$5,000 or more of nontaxable social
security or other nontaxable pensions,
annuities, or disability income

Married filing jointly and both spouses are
eligible for the credit

$25,000 or more

$7,500 or more of nontaxable social
security or other nontaxable pensions,
annuities, or disability income

Married filing separately and you lived
apart from your spouse for all of 2012

$12,500 or more

$3,750 or more of nontaxable social
security or other nontaxable pensions,
annuities, or disability income

and total disability. However, any payment you received from a plan that does not provide for disability retirement is not disability income.
In figuring the credit, disability income does not
include any amount you received from your employer's pension plan after you have reached mandatory
retirement age.
For more details on disability income, see Pub.
525.

Example 1. Sue retired on disability as a sales
clerk. She now works as a full-time babysitter earning minimum wage. Although she does different
work, Sue babysits on ordinary terms for the minimum wage. She cannot take the credit because she is
engaged in a substantial gainful activity.
Example 2. Mary, the president of XYZ Corporation, retired on disability because of her terminal illness. On her doctor's advice, she works part time as
a manager and is paid more than the minimum wage.
Her employer sets her days and hours. Although
Mary's illness is terminal and she works part time,
the work is done at her employer's convenience.
Mary is considered engaged in a substantial gainful
activity and cannot take the credit.
Example 3. John, who retired on disability, took a
job with a former employer on a trial basis. The purpose of the job was to see if John could do the work.
The trial period lasted for some time during which
John was paid at a rate equal to the minimum wage.
But because of John's disability, he was given only
light duties of a nonproductive, make-work nature.
Unless the activity is both substantial and gainful,
John is not engaged in a substantial gainful activity.
The activity was gainful because John was paid at a
rate at or above the minimum wage. However, the
activity was not substantial because the duties were
of a nonproductive, make-work nature. More facts
are needed to determine if John is able to engage in a
substantial gainful activity.

Part II. Statement of Permanent
and Total Disability
If you checked box 2, 4, 5, 6, or 9 in Part I and you
did not file a physician's statement for 1983 or an
earlier year, or you filed or got a statement for tax
years after 1983 and your physician signed on line A
of the statement, you must have your physician complete a statement certifying that:
You were permanently and totally disabled on
the date you retired, or
If you retired before 1977, you were permanently and totally disabled on January 1, 1976, or January 1, 1977.
You do not have to file this statement with your
tax return. But you must keep it for your records.
You can use the physician's statement later in these
instructions for this purpose. Your physician should
show on the statement if the disability has lasted or
can be expected to last continuously for at least a
year, or if there is no reasonable probability that the
disabled condition will ever improve. If you file a
joint return and you checked box 5 in Part I, you and
your spouse must each get a statement.
If you filed a physician's statement for 1983 or an
earlier year, or you filed or got a statement for tax

Disability Income
Generally, disability income is the total amount you
were paid under your employer's accident and health
plan or pension plan that is included in your income
as wages or payments instead of wages for the time
you were absent from work because of permanent

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years after 1983 and your physician signed on line B
of the statement, you do not have to get another
statement for 2012. But you must check the box on
line 2 in Part II to certify all three of the following.
1. You filed or got a physician's statement in an
earlier year.
2. You were permanently and totally disabled
during 2012.
3. You were unable to engage in any substantial
gainful activity during 2012 because of your physical or mental condition.
If you checked box 4, 5, or 6 in Part I, enter in the
space above the box on line 2 in Part II the first
name(s) of the spouse(s) for whom the box is
checked.
If the Department of Veterans Affairs (VA) certifies that you are permanently and totally disabled,
you can use VA Form 21-0172 instead of the physician's statement. VA Form 21-0172 must be signed
by a person authorized by the VA to do so. You can
get this form from your local VA regional office.

ble disability income that he reports on Form 1040,
line 7. He is filing jointly with his wife who was age
67 in 2012, and he checked box 6 in Part I. On
line 11, Bill enters $9,000 ($5,000 plus the $4,000 of
disability income he reports on Form 1040, line 7).
Example 2. John checked box 2 in Part I and enters
$5,000 on line 10. He received $3,000 of taxable
disability income, which he enters on line 11. John
also enters $3,000 on line 12 (the smaller of line 10
or line 11). The largest amount he can use to figure
the credit is $3,000.

Lines 13a Through 18
The amount on which you figure your credit can be
reduced if you received certain types of nontaxable
pensions, annuities, or disability income. The
amount can also be reduced if your adjusted gross
income is over a certain amount, depending on
which box you checked in Part I.
Line 13a. Enter any social security benefits (before
deduction of Medicare premiums) you (and your
spouse if filing jointly) received for 2012 that are not
taxable. Also, enter any tier 1 railroad retirement
benefits treated as social security that are not taxable.
If any of your social security or equivalent railroad retirement benefits are taxable, the amount to
enter on this line is generally the difference between
the amounts entered on Form 1040A, line 14a and
line 14b, or Form 1040, line 20a and line 20b.
If your social security or equivalent railroad
retirement
benefits are reduced because of
!
CAUTION
workers' compensation benefits, treat the
workers' compensation benefits as social security
benefits when completing Schedule R (Form 1040A
or 1040), line 13a.

Part III. Figure Your Credit
Line 11
If you checked box 2, 4, 5, 6, or 9 in Part I, use the
following chart to complete line 11.
IF you checked . . .

THEN enter on line 11 . . .

Box 6

The total of $5,000 plus the
disability income you reported on
Form 1040A or 1040 for the spouse
who was under age 65.

Box 2, 4, or 9

The total amount of disability
income you reported on Form
1040A or 1040.

Box 5

The total amount of disability
income you reported on Form
1040A or 1040 for both you and
your spouse.

Line 13b. Enter the total of the following types of
income that you (and your spouse if filing jointly)
received for 2012.
Veterans' pensions (but not military disability
pensions).
Any other pension, annuity, or disability benefit
that is excluded from income under any provision of
federal law other than the Internal Revenue Code.
Do not include amounts that are treated as a return
of your cost of a pension or annuity.

Example 1. Bill, age 63, retired on permanent and
total disability in 2012. He received $4,000 of taxaCredit Limit Worksheet—Line 21

Keep for Your Records

Use this worksheet to figure your credit limit.
1. Enter the amount from Form 1040A, line 28; or Form 1040, line 46 . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.
2. Enter the amount from Form 1040A, line 29; or Form 1040, lines 47 and 48 . . . . . . . . . . . . . . . . . . . . 2.
3. Subtract line 2 from line 1. Enter this amount on Schedule R (Form 1040A or 1040), line 21. But if
zero or less, STOP, you cannot take this credit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.

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Do not include on line 13b any pension, annuity,
or similar allowance for personal injuries or sickness

resulting from active service in the armed forces of
any country, or in the National Oceanic and Atmospheric Administration or the Public Health Service.
Also, do not include a disability annuity payable under section 808 of the Foreign Service Act of 1980.

Instructions for Physician's Statement
Taxpayer

Physician

If you retired after 1976, enter the date you retired in A person is permanently and totally disabled if both
the space provided on the statement below.
of the following apply.
1. He or she cannot engage in any substantial
gainful activity because of a physical or mental
condition.
2. A physician determines that the disability has
lasted or can be expected to last continuously for at
least a year or can lead to death.

Physician's Statement

Keep for Your Records

I certify that
Name of disabled person
was permanently and totally disabled on January 1, 1976, or January 1, 1977, or was permanently and
totally disabled on the
date he or she retired. If retired after 1976, enter the date retired.

▶

Physician: Sign your name on either line A or B below.
A The disability has lasted or can be expected
to last continuously for at least a year . . . . . . .
Physician's signature

Date

Physician's signature

Date

B There is no reasonable probability that the
disabled condition will ever improve . . . . . . . .
Physician's name

Physician's address

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