A US resident and trying to find out how to file Individual Tax Returns? Well, the answer is filing Form 1040.
Form 1040, also known as US Individual Tax Returns, is one of the many information returns issued by the IRS. All the individual taxpayers in the USA need to file this form. The IRS started accepting these returns and processing them on January 23, 2023.
In the form, the taxpayers basically disclose their taxable income so that the IRS can determine whether there are any overdue tax payments or not. If not, then it helps in calculating the tax return amount.
Filing Deadline
The deadline of filing these returns is April 18, 2023. Failing to file return in due time can make IRS levy late charges and penalties on taxpayers.
Therefore, one must stay prepared with information about the income made during the previous tax year. People might also have to decide whether they want to apply for standard deduction or go for itemizing return.
A step-by-step guide to file Form 1040
Filing a tax form means that various other documents are required to act as proof for your return claim. Therefore, if you haven’t prepared the documents, go through this checklist:
• Gather the necessary documents
such as Form W-2 from each of the employers you are working for, Form 1099s and Form 1099-INT for statements regarding other income and interest, and the receipts of charities or donations made during the year as well as business expenses in case of itemized returns.
• Choose a suitable filing status
based on your marital status as household expenses also play a significant role in your tax returns.
• Decide the filing mode
whether you want to paper file or e-file your Individual Federal Tax Return. If you are running late or want a real-time solution, e-filing the form is considered to be the right way.
NOTE: If you owe money to someone, you have to get it sorted first. Then look for the appropriate payment plan.
Schedules along with Form 1040
Generally, there are various schedules within Form 1040; some are lettered and others are numbered. In this section, we will discuss the numbered schedules that you might need to fill out while filing Form 1040.
• Schedule 1
This schedule is filled when there is an additional income such as money received from unemployment compensation, money received as a prize or award, money earned through gambling, and so on. It also includes information about deductions incurred in student loan interest, self-employment tax, or educator expenses which ultimately increase the income.
- Schedule 2
Schedule 2 includes additional taxes such as self-employment tax, additional tax applied on IRAs, household taxes, taxes applied on qualified retirement plans or tax-favored accounts, and any other taxes paid in advance.
- Schedule 3
In this schedule, additional credits and payments are included which are not claimed via filing Form 1040 or Form 1040-SR. Credits and payments such as education credits, foreign tax credits, general business credits, withheld social security tax, or payments made for filing extensions.
Finally…
We hope that you are prepared to file Form 1040 within due time so that you can dodge the huge penalties that may apply. If there are still queries and other concerns related to the federal tax returns, we urge you to get in touch with an expert. You can also check which types of 1099s apply to you for filing Form 1040.
Written by – Priyanka Rampal
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