Sunday, February 1, 2009

What Form Do I Use To File My Taxes

The beginning of the new year always reminds me that is now time to start collecting all the doccuments that I need to file my taxes. If you do this on your own, one the issues that many people struggle with is which form do I use. The IRS has three forms for filing individual tax returns, the 1040, 1040A, and the 1040EZ.

Form 1040
The 1040 form is the standard income tax form. Any U.S. resident can use Form 1040, but it is also commonly referred to as the "long form" since it covers many additional schedules that may apply to a more complex tax return such as income from owning rental property or running your own small business. The 1040 should be used if:

  • Taxable income is more than $100,000.

  • You have itemized deductions.

  • You have self employment income.

  • You have sold your home.

Form 1040A
If your tax return does not quite require the full 1040, the next option is Form 1040A. There are some limitations as to who can use this form.

  • Your taxable income is under $100,000.

  • You use the standard deductions.

  • You have above the line deductions.

  • You have capital gain distributions, but no other capital gains or losses.

Form 1040EZ
The simplest income tax form is Form 1040EZ. This form is for only the most basic tax returns, and a number of limitations apply.

  • Your income is under $100,000.

  • Your filing status is either single or maried filing jointly.

  • You do not have any dependents.

  • You are not legally blind.

  • You and your spouse are not over 65.

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