Income Tax Forms: Basic Differences between Form 1040, 1040A & 1040EZ

There are several forms available to fill your tax. But all of these forms do not cater to the same purpose. The simplest tax form is what you need to use to avoid complications in preparing your returns. With such a form you are assured of quick tax returns as the IRS can process it in short time. Here are the guidelines for taxpayers eligible to complete the 1040ez 1040a and 1040 form

 Form 1040

The simplest form that all and sundry can use is the 1040. It is a misnomer to call it simple because it takes longer to fill out. It is called simple just because this form is meant for all tax situations irrespective of how complex the calculations are. Also, one can never go wrong with this form.

 When to Use Form 1040?

This form is meant for those:

  • With an income of $100,000 or more
  • People who wish to itemize deductions (charity or mortgage interest)
  • People having a farm, rental, business, S-corporation, partnership, or trust
  • Those having foreign wages, paid foreign taxes, or wish to claim tax treaty benefits
  • People who sold bonds, stocks, mutual funds, or immovable assets
  • The ones who claim adjustments for educator expenses, health savings accounts etc.

 Form 1040EZ

This form can be used by those who have earned less than $100,000. Other criteria for using this form include:

  • People whose interest earnings are under $1,500
  • Earnings are only from wages, compensation, interest, etc.
  • By couples who are under 65 years old
  • Those who do not have any adjustments to income
  • Those claiming the only standard deduction
  • Those not claiming any other tax credits

Form 1040A

The 1040A lies in between the other two forms. It supports all filing statuses and income type and even dependents. It does not support self-employment income, capital gains, rental property, income etc.

With 1040A you can claim common adjustments to income. It can be used by people who have:

  • Total income less than $100,000
  • By people of any age and filing status
  • By people who earn from varied sources like wages, dividends, interest, IRA or pension distributions, capital gain distributions,  Social Security benefits or Unemployment compensation.
  • One can claim adjustments to income for a host of reasons and claim tax credits:

This form 1040A however cannot be used to itemize deductions. Before choosing this form to file returns it is advisable to check the types of deductions made available for form 1040.

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