New, Simplified Form 1040 Will Be Available For Tax Filers In 2019
Tax season isn’t really that far off, and when it finally gets here taxpayers will be greeted by a new Form 1040. This shorter, simplified form is another way the IRS is looking to assist taxpayers with the filing processes.
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So, what is changing?
Well, to start, the new form is about half the size of the current version – reduced from 79 lines to 23. Furthermore, this new form will effectively replace the current 1040 as well as forms 1040EZ and 1040A, which were traditionally used by taxpayers with less complex tax situations.
The IRS recently released a copy of the new form and is working to have it finalized by the end of summer 2018.
A New Approach
The new Form 1040 takes a “building block” approach to the filing process, meaning that every taxpayer can use the same, simplified version to file their taxes. Furthermore, any taxpayer with standard tax circumstances will only be required to file the new Form 1040.
That being said, if your tax situation is a little more complicated, you should expect to report your information on one or more of the six new schedules (or attachments), which will ultimately build out from the new Form 1040. Hence … the building block approach in action.
The six schedules you could come face-to-face with include:
- Schedule 1: Additional Income and Adjustments to Income
- Schedule 2: Tax
- Schedule 3: Nonrefundable Credits
- Schedule 4: Other Taxes
- Schedule 5: Other Payments and Refundable Credits
- Schedule 6: Foreign Address and Third-Party Designee
From the information gathered on these tax forms, the IRS will be able to gather the necessary information from taxpayers to determine whether they have a tax refund or liability.
IRS Preparation
The IRS has made it a priority to work closely with the tax community to prepare for the new Form 1040 roll-out. According to reports, paper filers are likely to experience the most dramatic change. Those who file their returns electronically, on the other hand, will see minimal differences throughout the filing process. That being said, the output will be different. For this reason, it’s important that all taxpayers are aware of this new approach so that they are comfortable signing off on their return and any accompanying schedules.
Learn More
This time of year it’s easy to push aside all thoughts of taxes, but the 2019 tax season will be here before you know it. A little mid-year tax planning can prove to be a vital, money-saving initiative – especially with all the new tax provisions out there to navigate. Get in touch with one of the tax planning specialists at Rea & Associates to find out if you will be prepared to file your 2018 tax return.
By Lisa Beamer, CPA (New Philadelphia office)