For some taxpayers, tax time is easy -- as in EZ. They are the ones who can use the IRS’s simplest tax form to complete their annual duty. (If you file electronically, the software automatically selects the simplest form for you. E-filing also speeds up the processing of your return and the delivery of your refund.)
Sign up for Tax Tips in your e-mail throughout the filing season
You can use Form 1040EZ if you are single or married with no dependents, you have taxable income of $100,000 or less, and you are younger than age 65. Plus, your taxable interest income from bank accounts and bonds can’t exceed $1,500 in order for you to use the simplest tax-filing form.
The Long and Short of It
If your tax situation is a little more complicated, choose Form 1040A, also known as the short form. You can use this form if your taxable income is $100,000 or less and you do not itemize your deductions.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
However, unlike Form 1040EZ, the short form lets you claim a number of “above the line” deductions, including up to $250 of out-of-pocket expenses for educational supplies if you are a teacher or educational professional; tax-deductible contributions to an IRA; and deductions for college tuition and fees or interest paid on a student loan.
Choosing the short form also allows you to take advantage of a variety of tax credits, which are even more valuable than tax deductions. A tax credit reduces your tax bill dollar-for-dollar; a tax deduction merely reduces the amount of income that is taxed. For example, if you are in the 25% tax bracket, a $1,000 deduction would reduce your tax bill by just $250, but a $1,000 tax credit would slash your tax liability by the full $1,000.
If you have taxable income of $100,000 or more, you itemize your deductions on Schedule A, or you need to file any special forms to report self-employment income, investment gains and losses, or rental or partnership income, you must use Form 1040, also known as the long form.
-
FSA Contribution Limits Are Higher for 2025FSA A flexible spending account allows you to build tax-free savings for certain medical expenses.
-
Florida Tax Deadline Extension: What You Need to KnowTax Relief The IRS extended federal tax return file time due to severe storms.
-
IRS: Here’s How to Recover Your Tax Records After a Natural DisasterTax Records Your tax documents can help you get federal relief faster, the IRS says.
-
Voters Approve New Veteran Property Tax ReliefTax Relief Thanks to the election, some Veterans will soon see expanded property tax exemptions.
-
Nevada Approves Diaper Tax Relief Amid Childcare CrisisTax Relief Nevada voters have expanded sales tax relief to diapers. But are prices still too high?
-
Earned Income Tax Credit (EITC) 2024: How Much Will You Get?Tax Credits The refundable amount for workers with or without children is slightly higher this year. Here’s what you need to know.
-
IRS Expands Tax Breaks for Breast Cancer Screenings, ContraceptivesHealthcare Now you can get a tax deduction or reimbursement for certain medical expenses, like over-the-counter birth control and condoms.
-
Adoption Tax Credit 2024: What You Need to KnowTax Credits The federal adoption tax credit is slightly higher for 2024. Here’s what you can claim under the tax break designed to help grow your family.
