Form 8689 Allocation of Individual Income Tax to the U.S. Virgin Islands 2007. Summary: This is an example of Form 8689 (2007) with these line items completed:

“Name(s) shown on Form 1040” field contains Gerald and Lily Smith

“Your social security number” number field contains 222-00-2222

Under “Part I: Income From the U.S. Virgin Islands”:

“2. Taxable interest” field contains 500

“11. Rental real estate, royalties, partnerships, S corporations, trusts, etcetera” field contains 6,200

“16. Add lines 1 through 15. This is your total income” field contains 6,700

Under “Part II: Adjusted Gross Income From the U.S. Virgin Islands”:

“28. Add lines 17 through 27” field contains -0-

“29. Subtract line 28 from line 16. This is your adjusted gross income” field contains 6,700

Under “Part III: Allocation of Tax to the U.S. Virgin Islands”:

“30. Enter amount from Form 1040, line 63” field contains 4,831

“32. Subtract line 31 from line 30” field contains 4,831

“33. Enter amount from Form 1040, line 38” field contains 54,901

“34. Divide line 29 above by line 33. Enter the result as a decimal (rounded to at least 3 places). Do not enter more than 1.000” field contains .122

“35. Multiply line 32 by line 34. This is your tax allocated to the U.S. Virgin Islands” field contains 589

Under “Part IV: Payments of Income Tax to the U.S Virgin Islands”:

“37. 2007 estimated tax payments and amount applied from 2006 return” field contains 400

“39. Add lines 36 through 38. These are your total payments” field contains 400

“40. Enter the smaller of line 35 or line 39. Also, include this amount in the total on Form 1040, line 72. On the dotted line next to line 72, enter Form 8689 and show this amount” field contains 400

“44. Amount you owe to the U.S. Virgin Islands. Subtract line 39 from line 35. Enter the amount that you are paying here and on Form 1040, line 72. Next to line 72, enter Form 8689 and the amount paid” field contains 189