Form 1040: Individual Tax Return
Let’s start with the basics: what is Form 1040, and why is it important?
NerdWallet sums it up best: “Form 1040, formally known as the U.S. Individual Income Tax Return, is the standard federal income tax form people use to report income to the IRS, claim tax deductions and credits and calculate their tax refund or tax bill for the year.”
This form ultimately determines if additional taxes are due or if the taxpayer will receive a refund. This form includes personal information, wage reporting, pensions, and other types of income. In addition to your personal information, some information regarding your spouse may also be needed, as well as the number of dependents you have.
The IRS created the updated Form 1040 with what they termed as a “building block approach.” This allows taxpayers to file their forms based on the schedules that apply to them directly. There are several different schedules, and some individuals may need to file more than one supplemental schedule with their 1040 depending on their unique situation. Keep in mind that many individual taxpayers only need to file a single 1040 and no schedules— our team can help determine if this is the case for you.
There are also several types of 1040 Forms depending on your status and geographic location. These types vary from the standard and could apply to you. Here’s a brief overview of what these forms are called and their purpose.
Form 1040-NR— created for nonresident aliens or their representatives.
Form 1040-ES— used to calculate and pay estimated taxes for the current year.
Form 1040-V— a statement accompanying a taxpayer's payment for any balance on the "Amount you owe" line of the 1040 or 1040-NR.
Form 1040-X— used to make changes or correct mistakes on previously filed 1040 Forms.
If you have questions about Individual 1040 forms or filing your taxes this season, contact our team of tax experts. We’re happy to answer your questions and set your business up for long-term success.
This post was inspired by Investopedia.
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