IRS Federal Tax Form 1040 – Types, Schedules & Instructions
Form 1040, the tax form used by individual taxpayers, was first introduced in 1913. The form’s basic setup has remained mostly the same over the past century. For the most part, Form 1040 conveniently collects information about your income, credits, and deductions in one place. However, over the years, the IRS has added dozens of supplementary forms and schedules you can use for additional calculations.
1040 Form Types
Form 1040 comes in four different varieties:
- Form 1040. Most taxpayers use the regular Form 1040. By itself, this form is just two pages long.
- Form 1040-SR. Taxpayers age 65 and older have the option of using Form 1040-SR. This form is nearly identical to the regular Form 1040, but it features larger print and a chart designed to help senior taxpayers calculate their standard deduction.
- Form 1040-NR. Nonresident aliens who have U.S.-source income and thus need to file a U.S. tax return use Form 1040-NR.
- Form 1040X. Taxpayers who need to amend their tax return after filing use Form 1040X.
If you’ve been filing federal income tax returns for a while, you probably noticed two versions of Form 1040 are missing from this list. The IRS used to have two shorter versions: Form 1040A and Form 1040EZ for filers with less than $100,000 in income and fewer deductions. However, when the Treasury Department redesigned Form 1040 in 2018, it eliminated these versions.
In the past, the IRS mailed Form 1040 and its accompanying instruction booklet to taxpayers. However, since more and more people file their taxes electronically, the IRS stopped automatically sending these forms.
If you need a paper copy of Form 1040, there are a few ways to get it (along with any necessary instructions, forms, and schedules):
- Print any form on IRS.gov.
- Visit a taxpayer assistance center. You must make an appointment and present a valid photo ID and your Social Security number or other taxpayer identification number.
- Visit a local library or post office. Some of these locations offer free forms for taxpayers. But call ahead to ensure they have forms available.
- Order forms online or by calling the IRS at 800-829-3676. The forms generally arrive by mail within 10 business days and are free of charge.
Note that Form 1040 isn’t always enough to complete your return. Many people have to attach additional forms and schedules to their return. That’s why it’s easier to use online tax filing software from TurboTax or H&R Block that walks you through questions and completes all the necessary forms for you.
Form 1040 Schedules
Form 1040 consists of several sections for reporting your name and personal information, your filing status (such as married filing jointly or separately), income, deductions, taxes, credits, and the final calculation of the amount you owe or the tax refund you can expect to receive from the IRS.
Many of these sections incorporate references to other forms or schedules. This system keeps the 1040 from becoming needlessly lengthy since you can do all the calculations pertaining to specific items on the relevant schedules rather than Form 1040 itself.
While there are dozens of schedules that can impact 1040, these are some of the most common ones.
You need Schedule 1 if you report types of additional income that aren’t on the 1040, including:
- Taxable refunds of state or local income taxes
- Alimony (for divorce decrees executed in 2018 or earlier)
- Business income from Schedule C
- Gains or losses from the sale of business property from Form 4797
- Rental income; royalties; or income from a trust, partnership, or S corporation
- Farm income or loss
- Unemployment compensation
Schedule 1 is also the place for reporting certain adjustments to income, also known as above-the-line deductions. You don’t need to itemize to take advantage of these deductions, which include:
- Educator expenses
- Business expenses for reservists, performing artists, and fee-based government officials
- Health savings account contributions
- Moving expenses for members of the armed forces
- The deductible part of self-employment tax
- Contributions to self-employed simplified employee pensions, savings incentive match plans for employees of small employers (aka SIMPLE), and qualified plans
- Health insurance premiums for self-employed people
- Penalties on early withdrawal of savings
- Alimony paid (for divorce decrees executed in 2018 or earlier)
- IRA contributions
- Student loan interest deduction
- Tuition and fees deduction
You only need to attach Schedule 1 to your Form 1040 if any of the income or deductions mentioned above apply to your return.
Schedule 2 is where you report other types of income besides your standard income tax. In Part I of Schedule 2, you report:
- Alternative minimum tax (calculated on Form 6251)
- Excess advanced premium tax credits that need to be repaid. This relates to subsidies for health insurance purchased on the Health Insurance Marketplace.
In addition to the information above, Part II of Schedule 2 is where you report:
- Self-employment taxes
- Unreported Social Security and Medicare tax
- The 10% penalty for early withdrawals from IRAs, qualified retirement plans, and other tax-favored accounts
- Household employment taxes
- Repayment of the first-time homebuyer credit
- Additional Medicare tax and net investment income tax
- Section 965 net tax liability for deferred income from certain foreign corporations
You only need to attach Schedule 2 to your 1040 if any of these situations apply to you.
Schedule 3 has two parts, Part I is for nonrefundable credits, including:
Nonrefundable credits can bring the amount of tax you owe to zero. But they won’t give you a refund over and above the amount paid in through withholdings or estimated payments.
Part II of Schedule 3 is for other payments and refundable credits. Refundable credits can result in a refund even if they drop your tax owed below $0. These refundable credits include:
- The premium tax credit for marketplace health insurance
- Amounts paid with a request for an extension
- Excess Social Security and Railroad Retirement Tax Act tax withheld
- Credit for federal tax on fuels
- Credit for tax paid on capital gains by a mutual fund company (Form 2439)
- Health coverage tax credit (only available to people who are eligible for trade adjustment assistance because they experienced a qualified job loss or individuals whose defined-benefit pension plans were taken over by the Pension Benefit Guaranty Corporation)
If you need to claim any of these tax credits, you must complete and file Schedule 3.
Other IRS Tax Forms
Schedule A is one of the most commonly used schedules. You use it to enter all your itemized deductions, such as medical expenses, mortgage interest, state and local taxes, and charitable contributions.
If you claim the standard deduction, you don’t need Schedule A.
You use Schedule B to report interest and dividend income greater than $1,500. If you received less than $1,500 of interest and dividend income, you can enter it directly on Form 1040, lines 2a and 2b.
If you freelance, work as an independent contractor, or own a business operating as a sole proprietorship or single-member LLC, you use Schedule C to report the income and expenses of the business.
You also use the amounts on this schedule on Schedule SE. If you made a profit of at least $400, you use Schedule SE to calculate your self-employment tax.
If you have a taxable investment account, you might have capital gains or losses. Usually, the brokerage sends you Form 1099-B, which includes all the information you need to complete Schedule D and report those gains and losses.
If you own income-generating rental properties or receive royalty income, use Part I of Schedule E to report that income.
You use Part II of Schedule E to report income or losses from pass-through entities, such as trusts, partnerships, multimember LLCs, and S corporations.
Schedule F is for farmers. Farmers can tally any income and expenses related to farming on this form.
Farmers may also want to use Schedule J to spread their tax liability between good years and bad years. Schedule J allows them to average their farm income over three years.
If you employ household employees like a nanny, housekeeper, cook, or gardener, you’re responsible for withholding income, Social Security, and Medicare taxes from their wages and paying payroll and federal unemployment taxes to the IRS. You use Schedule H to calculate and report these taxes.
Taxpayers who are age 65 or older or those on disability who have taxable income may be able to reduce their tax liability by claiming the credit for the elderly or the disabled. Schedule R helps you determine how much you can claim.
Most tax preparation software automatically fills out the appropriate forms once you enter all your information. However, when it comes to taxes, it pays to be aware of your tax filing requirements and the forms and schedules you need to claim deductions and credits that can help you save money.
Published at Tue, 15 Dec 2020 18:00:56 +0000