Form 1040 is the tax return document used by income individuals to file their tax return. Individual taxpayers can use this form to submit their tax returns. The form includes details about income, deductions, and tax credits, and then uses this information to show the amount you owe or will be refunded. To calculate the various financial amounts requested by the form, you will likely need to use additional forms and schedules.
How does Form 1040 work?
Form 1040 is the standard form for filing individual tax returns distributed by the Internal Revenue Service. Taxpayers use this form to submit returns or payments. The form outlines details concerning income, deductions, and tax credits, and then uses this information to show the amount you owe or will be refunded. To calculate the various financial amounts requested by the form, you will likely need to use additional forms and schedules.
Example of Form 1040
You are an employee at a bank where you earn $40,000 a year. When tax season comes, you will need to file a return. Therefore, you use a tax preparation app to fill out Form 1040 and all the required schedules and forms. You submit the completed Form 1040 to the Internal Revenue Service through the app, and the IRS notifies you once your return is accepted.
Who uses Form 1040?
Most taxpayers in the United States are required to file taxes using Form 1040 – or one of the forms derived from it – along with any necessary schedules to report taxable income. Taxpayers who meet the following requirements must file Form 1040:
- Income filing status for 2022 Income for 2023
- Single $12,950 $13,850
- Married filing jointly $25,900 $27,700
- Married filing separately $5 $5
- Head of household $19,400 $20,800
- Qualifying widow $25,900 $27,700
Taxpayers who are 65 years old or older, or who are blind, can increase the minimum income threshold for filing by $1,400 in 2022 and $1,500 in 2023. If you are unmarried and not a widow, you may claim an additional $350.
Types of Form 1040
There are nine versions of Form 1040 available. Each form is designed for a different category of taxpayers. The most common are Forms 1040 and 1040 SR:
- Form 1040: Standard Individual Tax Form
- Form 1040 SR: Form for individuals over 65 years old
These forms are derived from Form 1040 but are used in special circumstances:
- Form 1040-C: Form for non-residents leaving
- Form 1040-ES: Estimated Individual Tax Form
- Form 1040-NR: Non-Resident Tax Form
- Form 1040 PR: Form for self-employed residents in Puerto Rico
- Form 1040-SS: Form for self-employed individuals in the U.S. Virgin Islands, Guam, American Samoa, the Northern Mariana Islands, and Puerto Rico
- Form 1040-V: Payment vouchers (for making tax payments)
- Form 1040-X: Amended tax returns
Schedules
You may need to fill out one or several schedules in addition to Form 1040, depending on your situation. Here are some of the most common schedules:
- Schedule 1: Additional Income and Adjustments to Income
- Schedule 2: Additional Taxes
- Schedule 3: Additional Credits and Payments
- 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
If you need a different schedule, the IRS lists them on their website for forms and publications.
Where to obtain Form 1040?
All reliable tax preparation software should have the latest Form 1040 for the tax year you are filing in the spring. You can also download and print a copy from the IRS website. The form is interactive, allowing you to complete it online, then print it and send it as a paper return. Make sure that the Form 1040 you download is for the correct tax year. The year always appears in the center at the top of the first page.
If
If you are using an online tax preparation program to file Form 1040, the program will fill out the form on your behalf based on the information you provide.
How to Fill Out and Read Form 1040?
Filling out your Form 1040 may not look very different if you file the return online using a guided tax preparation tool. Whether you filled it out and printed it for submission or worked with an accountant or used an online program, it is helpful to know what to expect before filing the return.
Note: Tax Day is usually on April 15 but can vary based on various factors.
Form 1040 consists of two pages and has several sections.
Filing Status
In this section, you will indicate your filing status – whether you are filing as single, married filing jointly, married filing separately, head of household, or qualifying widow. You will also include your personal information, including your name, address, Social Security number, and more.
Digital Assets
In this section, you will indicate whether you have sold, received, exchanged, gifted, or disposed of a digital asset.
Standard Deduction
Here, you will indicate whether someone can claim you or your spouse as a dependent. There is also a checkbox to indicate if your spouse is filing separately or if you started the tax year as a non-resident of the United States and then gained residency.
There is also a subsection here for “Age / Blindness,” which asks about your age and your spouse’s birth year and whether either of you is currently blind.
Dependents
If you have dependents, this is where you will list their names, Social Security numbers, their relationship to you, and the applicable tax credits.
Income
This is the main section of the form. In lines 1 through 33, you will fill in information such as wages, salaries, tips; qualified earnings; retirement and pensions, Social Security benefits; capital gain or loss; charitable donations, and more. Line 15 is where the taxable income goes, which is the last line on the first page.
Taxes and Credits
Page 2 starts with line 16, and you will be asked to provide information regarding withheld taxes (from W-
Source: https://www.thebalancemoney.com/the-new-irs-tax-form-1040-4773115
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