Finish your federal taxes first. All three of the local tax jurisdictions practice tax conformity -- which simply means that the information on your state or District tax return is derived from the data you enter on your federal return. Start by transferring some numbers from your federal return; then make adjustments up or down to arrive at state taxable income.

Obviously, then, it is necessary that you complete your federal income tax return first. But don't finalize that federal return until you have completed your state or District of Columbia return.

Sometimes the additional research you do for the state or D.C. return will trigger a change on the federal return.

The accompanying "State Filing Minimums" table spells out for the various categories of taxpayers the minimum income level at which the requirement to file a state return starts. Note that Maryland minimums are the same as for the federal return; but the District and Virginia have lower dollar minimums than Uncle Sam for some filing categories.

In all three jurisdictions the filing minimums apply to "state" income -- that is, the amount you reach after adjusting federal income as directed by your particular jurisdiction. So you may find you are required to file a state return even though you are exempt under federal rules.

General Rules. Before we take a look at the requirements for each of the separate jurisdictions, there are a few rules and tips that apply to all three.

The District, Maryland and Virginia all provide a special filing category for a married couple (living together) when both spouses have taxable income. Since the income of each spouse may be reported separately, there is no "marriage tax penalty" as there is on the federal return.

Because of the availability of the "combined-separate" filing category, the two-earner deduction allowed on federal Schedule W is not allowed by the states. So each of the three jurisdictions requires that the amount of that deduction be added back to federal adjusted gross income.

The tax people in all three jurisdictions ask that you use the peel-off label from the instruction booklet on your return. If any of the information is incorrect, use the label on a District or Virginia return anyway -- but make necessary corrections. If any information on the Maryland label is wrong, discard it and print the information on the return instead.

If you're a District or Virginia taxpayer, you must complete the return and compute the tax yourself; neither jurisdiction will compute the tax for you, as the IRS offers to do in some cases. Although the state's instruction booklet doesn't mention it, Maryland's tax division will compute the tax liability for you if you furnish the necessary information.

You can make the calculations easier by rounding all figures to whole dollars: you "round up" -- increase the dollar figure by one -- if the number is 50 cents or higher, and "round down" -- leave the dollar figure unchanged -- if the number is less than 50 cents.

If you moved your legal residence into or out of one of the three jurisdictions during 1984, you must file a part-year return for the period of residence (if your income equals or exceeds the filing minimum).

Although each state has somewhat different rules for a part-year return, in general you prorate exemptions and allocate income and deductions to the period in which they occurred. (Exception: In Virginia, if you derived your entire federal adjusted gross income for the full year from Virginia sources, you may claim the full personal exemption instead of prorating. If married, both spouses must meet this requirement.)

All three jurisdictions have "pay-as-you-go" tax systems. This requires that you file an estimated return and make quarterly payments if you have taxable income in excess of specified limits that is not subject to state tax wthholding.

(For 1985, Maryland has changed the due date for the third installment of estimated tax, advancing it from Oct. 15 to Sept. 15 to coincide with the federal date.)

Military Personnel. If you are a legal resident of the District of Columbia, Maryland or Virginia, you don't lose that resident status when living elsewhere because of a military duty assignment. You are subject to income tax and required to file a resident return in your state of domicile regardless of where you are stationed.

Conversely, if you are a legal resident of another state, you are not subject to income tax in any of the three local jurisdictions solely because you are assigned to military duty here.

In Maryland and Virginia, you are not required to report or pay tax on military income unless you are a legal resident there. But you are liable for reporting, as a nonresident, income earned from other sources within the state (a moonlighting job, for example).

(In Virginia, nonresident military personnel are required to report both military pay and "moonlighting" income. However, you are not required to pay tax on the military income.)

The District of Columbia doesn't tax the income of nonresidents regardless of where it was earned. So if you are a member of the military living in the District but claiming legal residence in another state, you need not report or pay tax on any income from any source.

In all three states, however, the husband or wife of a member of the armed forces is considered a resident or nonresident according to the general rules in each state, without regard to the military status of the spouse.

So if you were stationed in the area, lived in one of the three jurisdictions during the year and your spouse worked locally, he or she may be subject to state tax even though you claim legal residence elsewhere. District of Columbia

Filing status. You have a choice of five different filing categories. The first four are essentially the same as their counterparts on the federal return: single, head of a household, married filing jointly and married filing separately.

The fifth filing category permits a married couple to file separate returns on the same form. This category should be used if each spouse had gross taxable income of more than $1,250 in 1984.

If you use this status, enter data pertaining to the husband in Column A and the wife's information in Column B. All other filers should use only Column B.

Exemptions. Personal exemptions are the same as on the federal return -- one per taxpayer (and spouse on a joint return) plus one for age 65 or older and one for legal blindness. The only difference is, if you file as head of a household you get an extra personal exemption not available on the federal return.

One exemption is allowed for each dependent claimed on your federal return. On a combined-separate return you may allocate the dependents to husband or wife as you wish.

The dollar amount for each personal and dependent exemption remains at $750, unchanged from last year. On a part-year return, exemption allowances must be prorated at $62.50 for each month of residence in the District of Columbia.

Income. In Part 1 on page 2 of the District return transfer the amounts, line by line, for the various types of income as they appear on your federal return. Do not make any changes here to federal figures; if modifications are required, they should be taken care of in Part II of the return.

There is no line on the D.C. form for copying taxable Social Security or Tier 1 Railroad Retirement benefits from the federal form; these benefits are not taxed by the District.

For line 34 (capital gain or loss) of the D.C. return, use the figure from either line 13 or line 14 of your federal return. (You should only have an entry on your Form 1040 on one of these lines, not both.)

If you filed a joint federal return and are filing combined-separate for the District, enter income items (and adjustments) in Columns A and B as if you had filed separate federal returns. The line-item total for the two columns must equal the amount for the corresponding line on the federal return.

Adjustments. On line 41 of the District return claim the total of all adjustments to income from line 31 of the federal return. (Do not eliminate from the total the Schedule W deduction for a two-earner couple; that will be taken care of in the next step.) Attach a list of individual adjustments to support the total.

Additions. Line 43 is where you add back to income the Schedule W deduction -- the federal "marriage tax penalty" -- taken on the federal return. Enter the amount in the column of the lower-earning spouse.

Other "additions" include any adjustments taken on line 41 which apply to a period that you were not a District resident and any income from federal Form 4972 not already included in Part I. (This is the form for computing 10-year averaging on a lump sum distribution from a retirement plan, a federal tax break not allowed on the District return.)

Do not add to your District income interest received on municipal bonds. Unlike most other states, the District does not tax interest income from municipal bonds issued by other states. Tax-free income from these bonds remains tax-free in the District regardless of the state of issue.

See page 5 of the District instruction booklet for other additions that apply only to a limited number of taxpayers.

Subtractions. Interest and dividend income received on obligations of the United States or its agencies is not taxable by the District (or any state). The total of such income included on your federal return should be subtracted by entering the amount on line 47.

If you reported a state tax refund as a part of your federal income, enter the same amount here on line 49 as a subtraction. And on line 54 do the same for any money you won in the D.C. lottery, which is taxable on the federal return but not in the District.

If you do not itemize deductions, you may claim, on line 48, the same limited charitable deduction you took on the federal return.

If you were a resident of the District for only a part of the year, subtract from gross income (by entry on line 50) all income received during the period you were not a resident, to the extent it appears above in the "Income" section.

In this situation, a compensating addition on line 45) is required to add back any adjustment such as an IRA contribution or employe expenses carried over from the federal return but attributable to the nonresident earnings being excluded.

Line 51 of Part II provided an opportunity to subtract from income any Social Security or Tier 1 Railroad Retirement benefits included in Part 1. If you followed the instructions and omitted those benefits from your income listing, do not subtract them again.

The old disability income exclusion has been eliminated for federal returns, leaving only a credit for the elderly and the disabled (federal Schedule R). The District still has an adjustment for disability income similar to the old federal adjustment.

If you included disability payments in your federal income (in Part I above), complete D.C. Form D-2440 to determine if you qualify for an adjustment of your District taxable income. You won't find the details in the D.C. instruction booklet -- look at Form D-2440 for specific instructions.

The last major subtraction, "Income Previously Taxed by D.C.," may require some calculations on a separate worksheet. For example, if you received distributions in 1984 from an IRA, the entire amount was taxable on your federal return because tax had been deferred on the earlier IRA contributions.

But prior to 1982 you were not permitted to exclude IRA contributions. from D.C. tax. Paying tax on the full amount of IRA distributions would result in double taxation on the same dollars.

So you now subtract from total 1984 distributions IRA contributions made while you were a D.C. resident on which you had already paid D.C. tax (but reduced by any amount you had already taken on your 1982 and 1983 returns).

If previously taxed contributions (after subtracting the 1982-83 adjustment) are larger than 1984 distributions, carry the balance forward to be applied against 1985 and later distributions until used up.

If you received pension or annuity payments prior to 1982, the old method of reporting those payments on the District return was substantially different from the federal method.

It isn't practical to examine all the possible situations here. The basic rule to remember is that the District government does not expect you to pay tax a second time on money that had been taxed previously.

If your entire pension payment was already fully taxable under the old rule, then it continues to be fully taxable now. But if before 1982 you had not recovered tax-free an amount equal to your cost, then for 1984 (and future years, if necessary) exclude from income all pension payments until you have recovered tax-free an amount equal to your total contributions to the plan.

If you went through these off-return calculations when preparing your 1982 and 1983 returns, you need only continue the figures for 1984 and future years until your payments become fully taxable.

Deductions. Just as on the federal return, District taxpayers have a choice between itemizing deductions or taking the zero bracket amount (ZBA). You have this option regardless of which way you went on the federal return.

The District ZBA is $500 each for couples filing either separate or combined-separate returns, and $1,000 for all other taxpapers. Because this is much lower than the federal allowance, you may want to itemize on your District return even if you took the ZBA on the federal return.

If you go this route, a D.C. Schedule A is provided in the tax package. But if you are itemizing on both the federal and District returns, District Schedule A is not required. You need only copy the total for each category from your federal Schedule A to the appropriate line in Part III of your District return.

After you have added all the deductions carried over to Part III, you must subtract some deductions authorized on the federal return but not allowed for the District. The most important of these are any deduction taken for state income tax paid and any deductions for periods when you were not a resident of the District.

Both members of a married couple filing either separate or combined-separate returns must file the same way. That is, if one itemizes, the other must itemize and may not take the ZBA. If they itemize, total deductions may be split between them any way they wish. Tax Credits

The qualifying rules for the child and dependent care credit are the same as for the federal return, but the amount of the credit is considerably less. So don't simply copy the federal credit to your District return.

Instead, multiply the authorized federal credit by 30 percent (.30) to get the amount of the D.C. credit. If you are filing a part-year return, or have not filed a federal return, use D.C. Form D-2441 to substantiate the credit claimed.

One difference between IRS rules and District rules: To qualify for the federal child and dependent care credit, a married couple must file a joint return; the D.C. credit may be claimed on a combined-separate return.

If you were a D.C. resident and were required to pay tax to another state on income earned in that state while a D.C. resident, you may claim a credit for all or part of the tax paid against your District tax liability. The formula for computing the amount of the credit is on page 3 of the instruction booklet. (Attach a copy of the other state return.)

There is also a tax credit for 50 percent of campaign contributions to specified District of Columbia political candidates. The list of offices for which the credit is authorized is on page 4 of the tax booklet. Maximum credit is $100 on a joint return, $50 per taxpayer on all others.

Federal employes. Because of the special nature of the relationship between the District of Columbia and the federal government, D.C. tax laws contain special provisions not found in any of the 50 states. These special provisions exempt people in these four categories from District income tax:

* An elected officer of the U.S. government, unless actually domiciled in the District.

* An officer of the Executive Branch who was appointed to office by the president, subject to confirmation by the Senate, and whose appointment may be terminated at the pleasure of the president, unless domiciled in the District at any time during 1984.

* A person on the personal staff of an elected member of the Legislative Branch (but not on a committee staff) if a bona fide resident of the same state as that elected member.

* A justice of the U.S. Supreme Court not domiciled within the District at any time in 1984.

Nonresident refunds. If you were not a resident of the District during 1984 but D.C. tax was withheld from your pay, file Form D-40B to claim a refund of the amount withheld.

Property tax credit. Residents of the District with household gross income of $20,000 or less during 1984 may be eligible for a property tax credit. The requirements to qualify are on page 5 of the instruction booklet.

Use Schedule H to calculate the credit. Carry the amount of the credit to line 20 of Form D-40, and attach Schedule H to the return.

If you have no income tax liability and are not filing a District income tax return, you may still claim the property tax credit by filing Schedule H by itself. If you qualify, you will receive a cash payment from the D.C. government for the amount of the credit.

Reminder: You are required to list, on page 2 of Schedule H, the names and Social Security numbers of all members of the household (other than the claiming taxpayer and spouse whose names go at the top of the form).

Budget-stretcher. If you customarily have your D.C. tax return prepared by a professional who doesn't use your instruction booklet or forms, check the box just above the signature block.

Then next year instead of getting a booklet and set of forms in the mail, D.C. tax dollars will be saved by sending you only a postcard with the mailing label to be used on the return. Virginia

Filing status. Virginia taxpayers have a choice of four filing categories: single; married filing jointly; married filing separate returns, or married filing separately on a combined return. There is no Virginia category corresponding to either of the federal categories: head of household or widow(er) with dependent child.

Virginia allows the filing of a joint return only if you filed a joint federal return or if neither spouse was required to file a federal return. But you may use the combined-separate category whether you filed your federal return jointly or separately.

Combined-separate filing is usually the better method if both spouses had Virginia taxable income. Try both joint and combined-separate filing to see which yields the lower total tax. If you file a combined-separate return, use Column A for the wife's calculations, Column B for the husband's. All other filers should use Column B only.

The table for filing minimums (on this page) shows $3,000 as the lowest figure for filing in any category. The law prescribes lower minimums for some categories -- $1,900, for instance, for a single taxpayer under 65. But there is a basic filing "exception" for all taxpayers: If your Virginia adjusted gross income is less than $3,000, a Virginia tax return is not required regardless of the normal rule.

Exemptions. The number of personal and dependent exemptions -- each worth $600 a year -- is the same as on the federal return. But in addition to the normal extra exemption for age, there is a further $400 allowance for each taxpayer (but not dependent) who was 65 or older on Dec. 31, 1984. This extra allowance is claimed on line 29 of Form 760 or line 4b of the 760S.

Income. Transfer to line 5 of Virginia Form 760 the figure for adjusted gross income from your federal return. If you are filing a combined-separate return, enter in Columns A and B the amounts attributable separately to each spouse. Don't subtract any Social Security or Railroad Retirement benefits that were taxable on the federal return; they will be handled in a later step.

Adjustments. All of the adjustments you had claimed on the federal return are allowed, without modification, on your Virginia return. This allowance is automatic, since the starting point for your Virginia calculations is federal adjusted gross income -- that is, after all federal adjustments have been subtracted.

Additions. Four principal additions are required to adjust federal income for Virginia tax purposes. On your Virginia return you must include any interest earned on obligations of states other than Virginia and not reported on your federal return.

Because the combined-separate filing category effectively eliminates any "marriage tax penalty," you must add back any deduction you claimed on federal Schedule W for a two-earner couple. Enter the addition in the column of the spouse who qualified for the credit on the federal return.

If you used 10-year averaging (Form 4972) in reporting a lump-sum distribution on your federal return, you must add back all of the ordinary income and 40 percent of the capital gains portion, minus the amount of the federal minimum distribution allowance. Attach a copy of Form 4972 to your Virginia return.

Taxpayers who use the Accelerated Cost Recovery system (ACRS) for depreciation of business property (on federal Form 4562) may have to restore 30 percent of the depreciation taken. If you use Schedule C and have a substantial ACRS deduction, see your tax adviser or a Virginia tax office for assistance.

Subtractions. In addition to the extra $400 allowance for age 65 mentioned earlier, you should subtract from Virginia income interest on federal obligations and any state tax refund reported as income on the federal return.

This is the point at which you deduct any Social Security or Tier 1 Railroad Retirement benefits, to the extent they were included in federal income. If you qualified for a Schedule R credit on your federal return, you may subtract for Virginia the amount of disability income used on Schedule R (not the amount of the federal credit). Attach a copy of Schedule R to your Virginia return.

Pension or retirement income of former employes of the state and its subdivisions and agencies (or the surviving spouse of such an employe) is exempt from state income tax. But if you claim this subtraction, you may not take either the disability income subtraction above or the credit for taxpayers age 62 and over explained below.

If you're eligible for any two or all three of these special deductions, you may select whichever one you wish. Do a little scratch-pad arithmetic and choose the one that gives you the best tax break.

Deductions. The standard deduction is equal to 15 percent of Virginia adjusted gross income (line 5 of Form 760) not to exceed $2,000 -- but at least $1,300 regardless of income. For a married person filing separately, the maximum is $1,000 and the minimum $650. (Note: If you reported a lump sum distribution on line 24, the 15 percent is applied against the total of lines 5 and 24.)

You may itemize on the Virginia return only if you itemized on your federal return. If your federal itemized deductions exceeded the federal ZBA for your filing status, or if you were required to itemize on the federal return, then you must itemize on your Virginia return.

If you are filing a combined-separate return, you may allocate your total deduction (either standard or itemized) to either spouse in whatever proportion you wish. Normally the better practice is to allocate all deductions to whichever spouse has the greater separate income.

Virginia itemized deductions are the same as federal deductions except for the exclusion of any deduction taken on federal Schedule A for state or local income taxes paid.

You transfer only a single figure for itemized deductions from federal Schedule A to the Virginia return. Be sure you use total deductions from line 24 of the federal schedule and not simply the excess (after subtracting the ZBA) from line 26.

Child care. Virginia allows a deduction for child and dependent care, rather than a tax credit as on the federal return. So don't use the amount of the federal credit for your Virginia return.

Instead, carry over to line 10(c) of Form 760 the amount of allowable expenses from line 5 of federal Form 2441, plus, if applicable, any 1983 expenses paid in 1984 (used in computing line 8); and attach a copy of the 2441 to your Virginia return. Like the federal ceiling, Virginia limits the deduction to $2,400 for care of one dependent, $4,800 for two or more. This deduction may be allocated to husband or wife, or in part to each, on a combined-separate return.

Tax credit for the elderly. You may qualify for a special tax credit if you were at least age 62 on Dec. 31, 1984, had adjusted gross income of less than $16,218 and had less than a specified amount (depending on your age) of Social Security or Railroad Retirement benefits.

The credit base for each age group and the instructions for claiming the credit are found on page 10 of the instruction booklet. The credit is calculated in Part VI of Form 760.

Tax paid to another state. If you paid income tax to another state, you may be eligible for a credit on your Virginia tax. The qualifications are described on page 3 of the tax booklet, and the instructions for completing Part V of Form 760 appear on page 9.

Wildlife program. You may elect to donate part or all of your tax refund (a whole dollar amount) to support the state conservation program for nongame wildlife. Enter an amount on line 20(a) of Form 760 or line 10(a) of the 760S; that amount will be subtracted from your refund and turned over to the Commission of Game and Inland Fisheries. Your contribution will be a valid Schedule A deduction on your 1985 federal and Virginia returns, if you itemize.

Political contribution. You may also contribute $2 of your refund to the Virginia central committee of either the Democratic or Republican party. On a joint or combined-separate return each spouse may elect this contribution separately.

Check the appropriate box on line 20(b) or 20(c) of Form 760, line 10(b) or 10(c) of Form 760S. Like the wildlife contribution, this election only works if you are due a tax refund; otherwise you may only make such contributions directly -- do not send additional money for either of these purposes with your tax return.

Renewable energy credit. Virginia allows a tax credit for the same kinds of renewable energy source expenditures as are allowed on the federal return. Energy conservation measures such as insulation or storm windows do not qualify for the Virginia credit.

The credit for 1984 is 25 percent of each qualified expenditure up to a maximum credit of $1,000. Calculate the credit on Virginia Form 300, which must be attached to your return. Any credit not used for 1984 may be carried forward to future years up through 1988. Maryland

Filing status. You have a choice of five different filing categories. Four of these are defined as they are on the federal return: single, married filing jointly, married filing separately and a qualifying widow(er) with a dependent child. The fifth category -- married filing combined-separate returns -- is provided for a married couple who file a joint federal return but wish to file separate state returns.

You should use this last filing category only if husband and wife each had independent Maryland taxable income in 1984. If you meet this condition, figure your tax both ways -- joint and combined separate -- to see which method gives you the lower total tax.

If you file combined or separate returns, use a single Form 502 and enter the husband's data in Column A, the wife's in Column B. All other filers use Column B only.

Exemptions. You are entitled to one Maryland exemption for each personal and dependent exception claimed on your federal return. In addition, you get an extra exemption for each dependent who has reached age 65 (unlike the federal return, where the "age" exemption is limited to the filing taxpayers).

Each exemption claimed on a full-year Maryland return is worth $800. The pro rata share on a part-year return works out to $66.67 per month per exemption.

Income. The first step in determining the amount of income subject to Maryland tax is to transfer the figure for each of the various income categories from the federal return to the appropriate line of Schedule A, page 2 of the Maryland return.

If you are filing combined-separate returns, allocate the appropriate part of each item of income to husband and wife. Half of the income from any asset registered in joint names is considered to belong to each spouse.

Adjustments. Claim the total of all adjustments taken on your federal return in a single lump-sum entry on line 35. Include the federal adjustment for a two-earner couple; it will be added back in the next section. If you're filing combined-separate, be sure to divide the adjustments according to whether they belong to husband or wife.

Additions. There are several modifications of federal income required to arrive at Maryland income. Additions to federal income are to be entered on Schedule C.

You must add to income the federal deduction for two-earner couples. Most couples with two incomes will file combined separate returns; add the federal allowance to the income of the lower-earning spouse (which is where it should have been deducted when dividing the adjustments).

Maryland does not allow the $100/$200 federal exclusion of dividend income, so the amount claimed on the federal return must be added back. You must also add any interest received in 1984 on any state or local obligations other than Maryland obligations that was not reported on your federal return.

If you filed Form 4972 (10-year averaging of a lump-sum distribution) with your federal return, you must add back the ordinary income and 40 percent of the capital gains, minus the minimum distribution allowance, reported on that form.

These are the principal additions to federal income for the Maryland return. Other additions that apply to a relatively small number of taxpayers are listed on page 19 of the instructions.

Subtractions. Use Schedule D on page 2 to deduct items included on your federal return that are properly excludable from Maryland income.

First, deduct interest received during the year on U.S. government or government agency obligations. (Interest on GNMA securities and income received from a mutual fund that invests in U.S. obligations are taxable on your Maryland return and may not be subtracted.)

Next, deduct any state tax refund reported as income on your federal return. Also exclude, to the extent it was included on your federal return, any capital gain realized on the sale of bonds issued by the state of Maryland or any of its local subdivisions.

Maryland allows the exclusion of up to $8,500 of pension income if you were 65 or older or totally disabled on Dec. 31, 1983 -- but reduced by Social Security or Railroad Retirement Act benefits received. Compute the exclusion -- separately for husband and wife if both qualify -- on the worksheet at the bottom of page 2 of Form 502.

If you include any Social Security or Railroad Retirement benefits under miscellaneous income in Schedule A, include it in Schedule D as an "Other" subraction. The ryland legislature passed emergency legislation, which Gov. Harry Hughes signed into law Jan. 25, excluding Social Security and Railroad Retirement benefits from taxation.

The Maryland tax benefit for child and dependent care is taken as a subtraction from income rather than as a tax credit. Get the information from your federal Form 2441 -- but carry over to the Maryland form the amount of qualifying expenses on which the federal credit was based, not the amount of the credit itself. Attach a copy of Form 2441 to your Maryland return.

You may subtract unreimbursed vehicle travel expenses at the rate of 20.5 cents a mile for the use of your car in volunteer work for certain specified charitable purposes (listed on page 19 of the instructions). Attach Form 502V to show your calculations.

New this year: The employer of a blind person or a blind employe may subtract the expense (up to a $1,000 ceiling) of obtaining a reader for use on the job.

Political and newsletter contributions may be subtracted up to an maximum of $100 on a joint return, $50 per taxpayer on all others. You also may be authorized to claim some of the expense of preserving and rehabilitating historical structures; qualifications and instructions are provided on Maryland Form 502H.

If you're a former police officer or fire fighter , you may subtract pension payments received for injury or disability incurred while working in that capacity, but only to the extent the payments are included in income.

And if you were a Maryland state trooper at any time during the period 1974 through 1977 and received subsistence payments that were reported as Maryland income, you may claim a special deduction on your 1984 tax return. See page 20 of the Maryland instruction booklet for details.

Deductions. The standard deduction is equal to 13 percent of Maryland adjusted gross income (line 5 of Form 502) up to a ceiling of $1,500 per taxpayer ($3,000 on a joint return). On a combined-separate return the standard deduction must be figured on the income of each spouse separately.

You may itemize even if you used the Zero Bracket Amount on your federal return; but then total itemized deductions for Maryland may not exceed the federal ZBA amount. Use Maryland Form 502A in this case.

If you itemized on the federal return, the ZBA ceiling doesn't apply, of course. You may claim the same deductions for Maryland as you claimed on the federal return, transferring the total for each category from federal Schedule A to the corresponding line on Schedule B of Form 502.

Two adjustments are required. From the federal total you must eliminate any deduction taken in Schedule A for state and local income taxes. And a qualifying artist may add a deduction for the value of his or her artworks donated to certain Maryland museums.

If you are filing a part-year return, there is a third adjustment: Subtract any deductions claimed on the federal return that apply to the period you were not a Maryland resident.

Tax Computation. You may find your tax on the tax tables in the instruction booklet if your Maryland adjusted gross income (after additions and subtractions) was $20,000 or less, you're filing a full-year resident return and you don't itemize deductions.

The tables have built-in allowances for the standard deduction and for personal and dependent exemptions, so do not subtract either of these amounts from income before going to the tables. Use the income figure on Line 5 of Form 502 or line 1, Form 503 and match that figure in the table to find your tax.

If you are not eligible to use the tables, compute your tax on one of the worksheets on page 20 of the instruction booklet, using the tax rate schedule on page 17. You must go this route if you have itemized deductions.

After finding the Maryland state tax from either the tables or the tax rate schedule, you must then add the local "piggyback" assessment to determine your total tax liability.

The local rate is 50 percent of the state tax for every county (and Baltimore City) except for the following: Calvert County, 20 percent; Queen Anne's, 45 percent; Talbot, 35 percent (up from 30 percent in 1983); and Worcester, 20 percent.

After computing your total tax liability, you then enter the amount of Maryland tax withheld and payments made on 1984 estimated tax during the year.

If you paid income tax to another state on Maryland income, you may be eligible to claim a credit against your Maryland tax. See Form 502CR for qualifications and instructions.

If you conduct a trade or business in Maryland, you may be eligible for credit for personal property tax paid on business property during the year, and for an enterprise zone credit. (The state personal property tax was repealed July 1, 1984.)

Property tax credit. Maryland does not offer a property tax credit through the income tax system. But for your convenience, an application for the Maryland homeowner's property tax credit (Form HTC-60) is included in the tax package mailed to you.

Do not attach Form HTC-60 to your income tax return, and do not forward it in the same envelope with the tax return. Two envelopes are inserted in the instruction booklet: gray (to the Comptroller of the Treasury) for mailing your income tax return, and blue (to the Homeowners' Tax Credit Program) for the homeowner's tax credit application.