'Tone' does not name a type

Hey im pretty new to arduino, I have this code and when I go to verify it, it reads ‘Tone’ does not name a type and highlights Tone tone1;, im not sure what that means or what to do about it, I have another tab with tone.h in it and ive downloaded the tone library to my desktop ( i heard to download it to the arduino file itself but im not sure how to do that.
Heres the code:

#include <Tone.h>

Tone tone1;

#define OCTAVE_OFFSET 0

int notes[] = { 0,
NOTE_C4, NOTE_CS4, NOTE_D4, NOTE_DS4, NOTE_E4, NOTE_F4, NOTE_FS4, NOTE_G4, NOTE_GS4, NOTE_A4, NOTE_AS4, NOTE_B4,
NOTE_C5, NOTE_CS5, NOTE_D5, NOTE_DS5, NOTE_E5, NOTE_F5, NOTE_FS5, NOTE_G5, NOTE_GS5, NOTE_A5, NOTE_AS5, NOTE_B5,
NOTE_C6, NOTE_CS6, NOTE_D6, NOTE_DS6, NOTE_E6, NOTE_F6, NOTE_FS6, NOTE_G6, NOTE_GS6, NOTE_A6, NOTE_AS6, NOTE_B6,
NOTE_C7, NOTE_CS7, NOTE_D7, NOTE_DS7, NOTE_E7, NOTE_F7, NOTE_FS7, NOTE_G7, NOTE_GS7, NOTE_A7, NOTE_AS7, NOTE_B7
};


char *song = "smb:d=4,o=5,b=100:16e6,16e6,32p,8e6,16c6,8e6,8g6,8p,8g,";
 void setup(void)
{
  Serial.begin(9600);
  tone1.begin(13);
}

#define isdigit(n) (n >= '0' && n <= '9')

void play_rtttl(char *p)
{
  // Absolutely no error checking in here

  byte default_dur = 4;
  byte default_oct = 6;
  int bpm = 63;
  int num;
  long wholenote;
  long duration;
  byte note;
  byte scale;

  // format: d=N,o=N,b=NNN:
  // find the start (skip name, etc)

  while(*p != ':') p++;    // ignore name
  p++;                     // skip ':'

  // get default duration
  if(*p == 'd')
  {
    p++; p++;              // skip "d="
    num = 0;
    while(isdigit(*p))
    {
      num = (num * 10) + (*p++ - '0');
    }
    if(num > 0) default_dur = num;
    p++;                   // skip comma
  }

  Serial.print("ddur: "); Serial.println(default_dur, 10);

  // get default octave
  if(*p == 'o')
  {
    p++; p++;              // skip "o="
    num = *p++ - '0';
    if(num >= 3 && num <=7) default_oct = num;
    p++;                   // skip comma
  }

  Serial.print("doct: "); Serial.println(default_oct, 10);

  // get BPM
  if(*p == 'b')
  {
    p++; p++;              // skip "b="
    num = 0;
    while(isdigit(*p))
    {
      num = (num * 10) + (*p++ - '0');
    }
    bpm = num;
    p++;                   // skip colon
  }

  Serial.print("bpm: "); Serial.println(bpm, 10);

  // BPM usually expresses the number of quarter notes per minute
  wholenote = (60 * 1000L / bpm) * 4;  // this is the time for whole note (in milliseconds)

  Serial.print("wn: "); Serial.println(wholenote, 10);

  // now begin note loop
  while(*p)
  {
    // first, get note duration, if available
    num = 0;
    while(isdigit(*p))
    {
      num = (num * 10) + (*p++ - '0');
    }

    if(num) duration = wholenote / num;
    else duration = wholenote / default_dur;  // we will need to check if we are a dotted note after

    // now get the note
    note = 0;

    switch(*p)
    {
      case 'c':
        note = 1;
        break;
      case 'd':
        note = 3;
        break;
      case 'e':
        note = 5;
        break;
      case 'f':
        note = 6;
        break;
      case 'g':
        note = 8;
        break;
      case 'a':
        note = 10;
        break;
      case 'b':
        note = 12;
        break;
      case 'p':
      default:
        note = 0;
    }
    p++;

    // now, get optional '#' sharp
    if(*p == '#')
    {
      note++;
      p++;
    }

    // now, get optional '.' dotted note
    if(*p == '.')
    {
      duration += duration/2;
      p++;
    }

    // now, get scale
    if(isdigit(*p))
    {
      scale = *p - '0';
      p++;
    }
    else
    {
      scale = default_oct;
    }

    scale += OCTAVE_OFFSET;

    if(*p == ',')
      p++;       // skip comma for next note (or we may be at the end)

    // now play the note

    if(note)
    {
      Serial.print("Playing: ");
      Serial.print(scale, 10); Serial.print(' ');
      Serial.print(note, 10); Serial.print(" (");
      Serial.print(notes[(scale - 4) * 12 + note], 10);
      Serial.print(") ");
      Serial.println(duration, 10);
      tone1.play(notes[(scale - 4) * 12 + note]);
      delay(duration);
      tone1.stop();
    }
    else
    {
      Serial.print("Pausing: ");
      Serial.println(duration, 10);
      delay(duration);
    }
  }
}

void loop(void)
{
//I chose pin 2 to read the PIR signal
  if (digitalRead(2) == (LOW)){
      play_rtttl(song);
      delay(5000); // wait 50 seconds for me so it doesn't endlessly loop.
  }
}

Moderator edit:
</mark> <mark>[code]</mark> <mark>

</mark> <mark>[/code]</mark> <mark>
tags added.

Here is a thread from someone wanting to know where to put a library

http://arduino.cc/forum/index.php/topic,88168.0.html

This is used to include files from common directories ( arduino core, libraries )

#include <file.h>

This is used to include files from your sketch directory

#include "file.h"