What is the Tax Form 1040?

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Form 1040Welcome to the inaugural post in our Tax Form series, a new, somewhat dry, tax series in which we take a look at all the various tax forms the IRS uses. I know it sometimes isn’t the most exciting of topics but understanding the various tax forms is absolutely crucial if you want to do your taxes. Many of you will probably be filing electronically, so software will help you decide which forms to use and how to fill it out, but there are still a few hold-outs out there who insist on filing by paper.

If you are one of them, then this new series is designed for you! (cue applause!)

The Tax Form 1040 is the cornerstone of your tax return. There are two alternatives in the Form 1040A and the Form 1040EZ, which are available to a subset of taxpayers, but the Form 1040 is the long form that many people think of when you talk about your federal personal income tax return. Form 1040A is basically Form 1040-Lite and Form 1040EZ is Form 1040-SuperLite.

Form 1040

The Form 1040 is the main document you fill out for your taxes and it comes with 12 optional “Schedules.” Each Schedule goes into greater detail into an aspect of income taxes, such as Schedule A: Itemized Deductions. You won’t necessarily need every single one of those Schedules but here’s a recap of each one (some of these will change from year to year, for example Schedule M will expire along with the Making Work Pay Credit):

  • Schedule A: Itemized Deductions
  • Schedule B: Interest and Ordinary Dividends
  • Schedule C: Profit or Loss From Business (Sole Proprietorship)
  • Schedule D: Capital Gains and Losses. There is a Schedule D-1 if there aren’t enough fields on Schedule D.
  • Schedule E: Supplemental Income and Loss
  • Schedule EIC: Earned Income Credit Qualifying Child Information
  • Schedule F: Profit or Loss from Farming
  • Schedule H: Household Employment Taxes
  • Schedule J: Farm Income Averaging
  • Schedule M: Making Work Pay
  • Schedule R: Credit for the Elderly or Disabled
  • Schedule SE: Self-Employment Tax

How do you know whether you need a Form 1040 or a Form 1040A or Form 1040EZ? It comes down to the complexity of your tax situation, in descending complexity. For example, if you plan on claiming the standard deduction, chances are one of the simpler forms is enough.

Form 1040A

The simpler form 1040A has only four schedules:

  • Schedule 1: Interest and Ordinary Dividends
  • Schedule 2: Child and Dependent Care Expenses
  • Schedule 3: Credit for the Elderly or the Disabled
  • Schedule EIC: Earned Income Credit Qualifying Child Information

As you can see, it has no Schedule A equivalent, for itemized deductions, because 1040A doesn’t let you claim itemized deductions. If you need to claim anything on a Schedule that isn’t in the above list, chances are you’ll need to use a Form 1040. Another rule is that your taxable income has to be below $100,000 to use the Form 1040A.

Form 1040EZ

The simplest of the three tax forms it the Form 1040EZ, which is a single page (with another worksheet page). You can use it if your taxable income is below $100,000, you’re filing single or married filing jointly, you (and spouse if applicable) are under 65 and not blind, you are not claiming any dependents, and your interest income is $1,500 or less.

As you can see, the rules aren’t so simple to understand, which explains the rising popularity of tax preparation software. Fortunately there are free tax filing options out there if you qualify for them.

{ 10 comments, please add your thoughts now! }

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10 Responses to “What is the Tax Form 1040?”

  1. HedgeHoncho says:

    “I know it can sometimes isn’t the most exciting of topics”

    LOL, i feel like this needs to be at the forefront of every tax discussion (and it typically is)

    1040EZ FTW!

    • skylog says:

      your post made me smile. i was also a fan of, “a new, somewhat dry, tax series in which we take a look at all the various tax forms the IRS uses.”

      that said, while it may not be the most exciting of discussions, it is one that more people should really be involved in.

  2. zapeta says:

    Who cares if its a little dry? Everyone has to deal with taxes and it’s nice to have a summary of the information in one place.

  3. Shirley says:

    It’s only dry if it’s something you already know and understand well. We all pay taxes and we all need to understand just how this system works. I have a teen just entering his tax-paying life and this will be great for him. Thanks!

  4. Strebkr says:

    Great article. I’m sure this will be very helpful to everyone.

    Now who has to file the most forms?

    I have:
    Sch A
    Sch B
    Sch C
    Sch D
    Sch E
    Sch M
    Sch SE

    plus the random worksheets that go along with those.

  5. Ted says:

    Are the tax forms (1040) late this year? I normally would have recieved mine by now, filled it out and got my refund back. Someone said they haven’t even been printed yet because
    of new tax laws that haven’t been voted on. Is any of that true?

    • Jim says:

      No it’s not, the only delay was in processing (and that’s since been resolved). The forms themselves are available at the post office, the IRS decided this year (or last year?) that they would no longer mail out forms.

  6. R. Denzil McMullen says:

    Seeking method to print Form 1040NR

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