The scene heading is also known as the slugline. Whatever the name, it is simply the part of the screenplay that tells where and when the scene is taking place and occasionally what kind of shot the scene is: INT. A SEEDY HOTEL ROOM. ESTABLISHING. The scene heading is flush with the left margin.
The action directions in a screenplay are used to indicate any kind of action that takes place or the description of the scene. The action is always written in the present tense. Only the first letter of the sentence is capitalized, except for character names. Action/description begins flush with the left margin and runs across the page to the right margin until a word break is necessary.
The name of the character is placed 3.5 inches from the left margin. The character's name should always be in all capital letters. If the character does not have a name, you still must capitalize whatever is used to identify him: RED-HEADED CROOK, LITTLE BROTHER, JERK AT THE END OF THE BAR.
Dialogue is the name given to any words spoken by any character, including inanimate characters. Even when the more appropriate word is monologue, the same format applies. Dialogue is placed 2.5 inches from the left margin and is usually allowed to run between 30 and 35 spaces to the right before the returning back to the right margin.
Although discouraged because parentheticals are often used to give directions that tread upon the actor's domain, parentheticals can be useful when used correctly. Parentheticals are simply verbal directions that come before dialogue. Although it may look better aesthetically, parentheticals are not centered under the name, but rather begin three inches from the left margin.
Not all dialogue is spoken directly on camera. When the dialogue is being narrated in a voiceover, heard from another character not on-screen, it is called an extension. The extension is placed one space after the character's name and abbreviations are used. O.S. is used for dialogue coming off off-screen. V.O. is used for voiceover narration.