Did you know TurboTax software is designed to take away the burden of understanding tax laws and IRS tax forms? If you e-file through TurboTax you don’t have to see a single tax form if you don’t want to. All the forms you need to complete your tax return are provided for you.
When you’re doing your income taxes, you will require a number of forms and probably the most significant one is the W-2 form. TurboTax Online will find and import your W2, which allows you to file your taxes as soon as possible.
You can be assured you are preparing and filing the correct tax form by using TurboTax online tax software. You don’t have to wonder if you should use the 1040 tax form, or the 1040EZ. Filing your tax return can be a nerve wrecking feeling, but it doesn’t have to be if you let the tax software guide you through the tax filing process.
Basic Things to Know About IRS Tax Forms
The 1040 tax form originated back in 1913, yet over the years, the basic setup has remained unaltered. This form collects your income, credits, and deductions. Furthermore, even though there are other forms and schedules that you can use for additional calculations, all of the final numbers from those forms are reported on the 1040 tax form.
Types of 1040 Tax Forms
There are different varieties of this tax form. We will be discussing them below.
1040 – This is also known as the “long form” because it contains two pages.
1040A – This is the shorter version of the “long form”, however, only those who make less than $100,000 and don’t itemize can utilize it.
1040EZ – This is the shortest 1040 tax form. It is one page, easy to follow and available to those under 65 who have less than $100,000 in taxable income. You also cannot claim dependents or any other income adjustments excluding the “Earned Income Credit”.
1040NR – This form is used by nonresident aliens who have income coming from the US.
1040X – This form is used when you need to amend your already filed tax return. It is easy to follow and you only have to fill in the sections that need to be changed on the original form. This form is processed manually so the processing time is longer than any other variation of the 1040 tax form.
IRS Form 1040 Instructions
In prior years, 1040 forms and instructions were sent out in the mail to tax payers. However, since many taxpayers don’t paper file, they are no longer sent out. Nevertheless, you can get paper copies of the form by going to an IRS center or your local post office. The IRS.gov website also has printable versions or you can place an order to have the forms mailed out to you.
Form 1040 Schedules
The long form 1040 has several sections for you to fill out your personal income (name, personal information, filing status, exemptions, income, adjustments to income, tax and credits, other taxes, payments, and the final calculation of what you have to pay or what you will receive in the form of a refund).
You will find that many options will reference additional forms or schedules. This keeps the “long form” 1040 from becoming even longer, since calculations are done on different schedules and not the 1040.
Currently, there are 12 schedules for the 1040, and numerous other forms, which may be used in conjunction with it.
We will only be discussing the most common ones below.
Schedule A – This is the most common schedule, which serves the purpose of itemizing deductions, such as mortgage interest, charitable donations, and medical expenses.
Schedule B – This schedule is used to report interest and dividend income that exceeds $1,500. If you didn’t exceed $1,500, it can be reported directly on the 1040 form.
Schedule C – This form is used for small business tax deductions. You will report you income and expenses on this form. You also will have to use Schedule SE if you made a profit from the business, so you can determine your self-employment income tax.
Schedule D – This is for calculating the taxes due on capital gains or losses accrued throughout the year.
Schedule E- If you generate income from rental properties, this form is needed to calculate profits. It can also be used to calculate income from royalties and pass through entities, such as trusts and S corporations.
Schedule F – This is for income or expenditures farmers accumulate.
Schedule H – You report the taxes you owe from hiring nannies, housekeepers, and others who work for you in your home.
Schedule J – This form is for farmers. With Schedule J, farmers have the option of averaging their income over three years to spread their tax liability between their good and bad years.
Schedule L – Individuals such as those older than 65 and the legally blind are able to get a larger standard deduction. This form allows them to see if they qualify and if so the amount that they are eligible to receive.
Schedule R – This schedule is for determining the tax credit available to the elderly or disabled who quality. It is only to be used by those over the age of 65 or those who receive disability, but have an additional taxable income.
Schedule SE – This schedule is for those who use Schedule C or Schedule F to determine how much taxes they owe on the income they profited. This may seem like it will be a burden, but you are able to reduce your taxable income on your 1040 form by half of the taxes that you owe.
Turning to TurboTax for Help at Tax Time
When you turn to TurboTax for help it will be like an interview. They will ask easy to answer questions while filling in the correct tax forms for you behind the scenes. The answers you provide will enable them to see which deductions and credits you qualify for. In the event that you are unsure how to answer a question there are tax experts readily available to help you.
TurboTax provides you with step by step instructions to insure that you get every deduction and credit that you are eligible for. TurboTax insures that you get the largest refund possible. They even have a free tax refund calculator available that allows you to know the amount of money that you will be getting back.