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Don’t Pay to File the 1040-EZ

Did you know that millions of Americans pay a tax preparer to file their 1040EZ [3]? It’s a single page with ten blanks! According to the Department of Education’s National Assessment of Adult Literacy, 20 million Americans pay someone to file their 1040EZ (courtesy of Red Tape Chronicles [4]).

It’s pretty amazing right? There’s no reason why you should pay someone to file your 1040-EZ because it’s literally 12 lines – one of which is for refund information (where to send your refund).

Do you qualify for the 1040EZ?

You can use the 1040EZ if you

When you look at the form, you can see that it really is designed for someone who gets all of their income from their job, with a little bank interest. If you look at the form, it’s not intimidating at all – it’s for the most vanilla of tax situations.

Deductions & Credits under 1040EZ

The main drawback of the 1040EZ is that the only credit you can take is the earned income tax credit [5]. In fact, if you use the 1040EZ, you can’t itemize deductions or claim any adjustments whatsoever.

If it still makes sense for you to file the 1040-EZ, just open it up and take a look [3]. If you read it line by line (there are only 12!), most of it is pretty self-explanatory. If there are any tricky parts, they usually reference a page number, that’s the page in the 1040 Instructions manual [6].

If you are still intimidated, take a look at these free tax filing resources [7]. You may qualify for assistance with the form without having to pay a tax preparer. Companies like TurboTax [8] and TaxAct [9] also offer free Federal tax preparation if you qualify (their business model is to give you Federal prep for free and sell you on State prep, since they already have all your information entered, it’s not a bad deal if you want to save time).

Please don’t be intimidated by the IRS to the point that you are one of the 20 million who pay to have a 12-line form filled out.

(Photo: alancleaver [10])