In an effort to simplify the tax return filing process the Internal Revenue Service (IRS) provides different forms for your Individual Income Tax return based on the complexity of your transactions during the tax years.
Depending on types of income and deductions you will take on your tax return, most taxpayers have the option to use Form 1040, 1040A and 1040EZ. There are certain criteria that the taxpayer must meet to be eligible to file a 1040A or 1040EZ.
The Form 1040A and 1040EZ returns are designed for quick preparation and quick review by the IRS since less risk is involved with these returns.
The 1040A is a simplified version for the Form 1040 but not as simplified as the 1040EZ is. The IRS and other tax software providers allow preparing and e-filing this form for free.
File an Easier Tax Return With 1040A
A simplified tax return not only helps the taxpayer but it also helps the IRS accept, review and issue a refund quicker. Although you many qualify for the 1040A, it may be more beneficial to file a Form 1040 for certain deductions and credits not available on the Form 1040A.
The Form 1040A is available for those whose taxable income is less than $100,000. The Form 1040A is also limited to certain adjustments to income, and credits. The Form 1040A doesn’t allow itemized deductions. If your itemized deductions would be greater than the standard deduction, you should be filling a Form 1040.
Who Can File a 1040A?
In order to qualify to file for the Form 1040A for your annual individual income tax year all 5 criteria must be met:
- Your taxable income on line 27 of the tax return is less than $100,000.
- Your source of income must come from the following:
- Wages, salaries and tips
- Interest income and ordinary dividends
- Capital gains
- Taxable scholarships and fellowship grants.
- Individual Retirements Accounts (IRA), pensions or annuities
- Unemployment compensation
- Alaska Permanent Fund dividends
- The adjustments to income you are allowed on the 1040A consist of:
- Educator expenses
- Individual Retirements Account (IRA) deduction
- Student loan interest deduction
- Tuition and fees deduction
- No itemized deductions can be taken on the Form 1040A. If your itemized deductions are greater than the standard deduction, it’s recommended to file a Form 1040.
- The only credits that you are eligible to be take on a Form 1040A are:
- Credit for child and dependent care expenses
- Credit for the elderly or the disabled
- Education credits
- Retirement savings contributions credit. e. Child tax credit
- Earned income credit
- Additional child tax credit
- Premium tax credit
If you had an alternative minimum tax adjustment on stock you acquired from an incentive stock option you are not eligible to file a Form 1040A. Even if you qualify for the Form 1040A, it’s important to go through the full Form 1040 to make sure you did not miss any deductions or credits that you may have otherwise been entitled to.
How to Get a 1040A Form Online
The IRS offers the traditional paper filing method of the Form 1040A but it’s recommended to use one of the free services below to e-file your return.
TurboTax Federal Free:
TurboTax by Intuit offers a TurboTax Free Edition for taxpayers who qualify for Form 1040EZ and Form 1040A. This allows taxpayers to utilize the TurboTax software and e-file their returns for free.
H&R Block Free Online Tax Filing:
H&R Block also has free tax software for taxpayers who qualify to file a Form 1040EZ or Form 1040A. This software allows you capture photos of your W-2 for a quick input of your income. As you prepare your tax return on this software, you can see exactly how much the expected refund is. Also, since this is an online software, it can be accessed from multiple devices.
IRS Website Electronically File (E-File)
The IRS.gov website allows anyone who makes less than $64,000 of adjust gross income (AGI) to file the Form 1040, 1040A and 1040EZ for free. If you qualify for this method, it’s a simple process to complete and electronically file your tax return directly on the IRS.gov website.
IRS Form (Paper File)
The IRS also allows for a printable PDF version of the Form 1040A. The printable version can be completed and mailed to the IRS (see the end of IRS instructions for mail address by state). E-filing your return will result in faster IRS acceptance and delivery of your refund.
How to Fill Out a 1040A
The Form 1040A has a similar look to the Form 1040 but it’s only a 2-page return with many line items and sections removed such as the section for itemized deductions.
The taxpayer completes their (and their spouse’s) name, social security number, and address in the first section of the Form 1040A.
Check the box of your filing status: (1) single, (2) married filing jointly, (3) married filing separately, (4) head of household, (5) qualifying widow(er) with dependent child.
Exemptions can be claimed for every dependent in your household which reduces your taxable income. In this section, all dependents first name, last name, social security number, relationship must be completed.
Line 7 of the Form 1040A start the income section of the tax return. In this section, you list out all the different types of income you may have. Each of the income items that qualifies (e.g. salaries and wages) for this form are listed on separate lines in the section. You must complete and add all the income line items to get to the total income.
Adjusted Gross Income (AGI)
Any adjustments such as educator expenses, student loan interest, IRA deduction and tuition and fees are completed in this section. These adjustments can reduce your income to get you to your Adjusted Gross Income (AGI).
Payments, Credits and Tax
After determining your AGI, you will reduce it by the standard deduction and any exemptions for dependents you have claimed. Once you have your taxable income, you will need to use the Form 1040A tax table from the instructions to determine your tax liability.
Note: The Form 1040A is does not allow for itemized deductions. You can only claim the standard deduction.
All payments of tax liability during the tax year should be entered in this section. This is typically from wage withholding from your employer and can be found on your W-2.
Finally, any credit you can claim on your tax return will reduce your tax liability, and even result in an additional refund if it’s a refundable credit.
If your tax liability was less than all the tax payments and tax credits, you are entitled to a tax refund from the IRS. You can choose to have your refund direct deposited into your checking or savings account by entering your routing number and account number. Choosing direct deposit instead of paper check speeds up the refund process.
Amount You Owe
If your tax liability was greater than all tax payments and credits, you will need to pay additional tax to the IRS. You can do this by check or the electronically (which is the preferred method). The IRS offers a direct pay and IRS2GO app which can be used to pay for your tax liability. TurboTax and H&R Block free software also offers a method to pay your tax due electronically using your checking account.
1040A Tax Table
Once you have calculated your income, adjustments to income and any exemptions, you will have your taxable income for the Form 1040A. You can use the instructions for Form 1040A to find the tax table.
Find your taxable income range and filing status on the table to determine how much tax you will owe for the year.
The instructions for the 2017 Form 1040A can be found here.
The Form 1040A is a hybrid between the Form 1040 and the Form 1040EZ. The Form 1040 can be filed by all taxpayers but has additional line items and schedules which are not required for most taxpayers. The Form 1040A helps simplify the filing process. Most tax software allows you to prepare and file the Form 1040A for free. Many taxpayers qualify to file for Form 1040A. This doesn’t always mean it’s the best option.
By filing a Form 1040, you can ensure you do not miss any deductions. Since the Form 1040A does not allow for itemized deductions, it’s important to calculate all itemized deductions to make sure it’s not higher than the standard deduction allowed.
As we start getting into tax season for the April 15 filing, you should determine if you can file a Form 1040A for a quicker and free method of filing the individual income tax return. For the quickest refund, use one of the electronically filed methods discussed (IRS.gov, TurboTax, H&R Block) and choose direct deposit as the method for your refund payment if you are expecting a refund.