| Standard Deductions | ||
|---|---|---|
| Filing Status | 2023 | 2024 |
| Single or Married Filing Separately | $13,850 | $14,600 |
| Married Filing Jointly or Qualifying Widow(er) | $27,700 | $29,200 |
| Head of Household | $20,800 | $21,900 |
An additional deduction may be taken by those who are age 65 or older or blind. Just like the standard deduction, these figures are adjusted annually for inflation.
- Aged or Blind: $1,500 in 2023 increased to $1,850 if the individual is also unmarried and not a surviving spouse. These amounts increase to $1,550 and $1,950, respectively, in 2024.
The standard deduction cannot be taken by an estate or trust, an individual who is filing a short return due to a change in accounting periods, an individual who was a nonresident alien part of the tax year, or a married individual whose spouse is filing separately and itemizing.
Additional Schedules
As noted above, Form 1040 uses a variety of additional schedules to help taxpayers report their tax obligations. The following schedules are used to compile financial information away from Form 1040 to later use Form 1040 as the primary source of reporting.
Schedule 1
Schedule 1 is used to report additional income or adjustments to income. This may include alimony, disposition proceeds from the sale of a business, educator expenses, health savings account (HSA) contributions, or unemployment compensation.
It's important to note that:
- Other Income from Schedule 1: This is reported on Line 8 of Form 1040
- Adjustments to Income from Schedule 1: This is reported on Line 10 of Form 1040
Schedule 2
Schedule 2 is used to report additional taxes. One part of Schedule 2 reports alternative minimum tax and repayment of excess premium tax credits for insurance bought through health insurance marketplaces.
Another part of Schedule 2 is used to report self-employment taxes, Medicare taxes, taxes on individual retirement accounts (IRAs), household employment taxes, and other taxes. These two parts from Schedule 2 are reported on Line 17 and Line 23 on Form 1040.
Schedule 3
Schedule 3 is used to report additional tax credits and payments. These credits include dependent care expense credits, residential energy credits, excess social security taxes previously remitted, and excess Federal income taxes previously remitted.
Nonrefundable credits from Schedule 3 are reported on Line 20 of Form 1040, while refundable credits from Schedule 3 are reported on Line 31 of Form 1040.
Schedule A (Itemized Deductions)
Schedule A is used to figure out a taxpayer's itemized deduction. A taxpayer's federal income liability is most often minimized when choosing the larger of their standard deduction or itemized deduction.
The itemized deduction calculation includes medical expenses, dental expenses, certain taxes, certain interest assessments, theft losses, and other expenses. Any input from Schedule A is entered into Line 12a on Form 1040.
Schedule B (Interest and Ordinary Dividends)
Schedule B is used for taxpayers who received greater than $1,500 of taxable interest or ordinary dividends. It is also used to report interest from a seller-financed mortgage, accrued interest from a bond, interest or ordinary dividends as a nominee, and other similar types of interest. Input from Schedule B is entered into Line 2b and Line 3b on Form 1040.
Schedule C (Net Profit From Business)
Schedule C is used to report business income or loss. An activity qualifies as a business if the taxpayer is engaged in the activity for the primary purpose of producing income or profit. The activity is also considered a business as long as the taxpayer is involved in the activity with regularity and continuity. Profit from Schedule C is entered on Schedule 1, Line 3. It is also used on Schedule SE.
If your business was a sole proprietorship or qualified joint venture and you meet other criteria, you can report your business operations using Schedule C.
Schedule D (Capital Gains and Losses)
Schedule D is used to report taxable income from the sale or exchange of a capital asset. This gain may have arisen from an exchange or an involuntary conversion. Schedule D is also used to report capital gain distributions not otherwise reported on Form 1040 as well as nonbusiness bad debts. Input from Schedule D is entered on Form 1040, Line 7.
Schedule E (Supplemental Income and Loss)
Schedule E is used to report various types of additional income or losses. This supplemental financial activity ranges from real estate rental income, royalties, partnerships, estates, trusts, and residual interests in real estate mortgage investment conduits. Supplemental income figures from Schedule E are reported on Form 1040 in the "Income" section.
Schedule EIC (Earned Income Credit)
Schedule EIC is quite different from other tax schedules. The earned income credit is calculated separately from this schedule. However, Schedule EIC is used to substantiate the qualification of your qualifying children by remitting to the IRS your child's name, Social Security number, birth year, relationship to you, and residency status. Information from Schedule EIC is not directly input into Form 1040.
The Earned Income Credit is maximized if a taxpayer has at least three children. Therefore, Schedule EIC only asks for information on three children; additional forms for additional children beyond three are not required.
Other Schedules
Other notable supplementary schedules to Form 1040 include:
- Schedule F is used to report profits or losses from farming operations
- Schedule H is used to report household employment taxes if you paid cash wages to household employees and those wages were subject to various Federal taxes
- Schedule J is used to report farming or fishing trade income by averaging taxable income over the previous three years
- Schedule R is used to report a credit for the elderly or disabled
- Schedule SE is used to report the tax due on net earnings from self-employment
- Schedule 8812 is used to report potentially refundable credits for qualifying children (or other dependents)
What Is Form 1040 Used for?
Form 1040 is the primary tax form used by U.S. taxpayers to file their annual income tax returns. Taxpayers input their personal information and tax information onto the form, then submit the form to the IRS for review.
Is Form 1040 the Same As a W-2?
Form 1040 is different from a W-2. A W-2 is a wage and tax statement an employee receives from a company they worked for during the tax year. The information listed on the W-2 is used to fill out Form 1040.
Where Can I Find Form 1040?
Form 1040 is not a tax statement or form that gets distributed to taxpayers. Unlike a W-2 or 1099 statement that is mailed by an employer or party you've contracted with, Form 1040 is available for download on the IRS website. In addition, free IRS filing platforms such as Free File Fillable Forms will provide digital copies. Last, some public courthouses or Federal buildings in your community may offer paper copies available for pickup.
What Is the Difference Between a 1040 and a 1099?
Form 1040 and Form 1099 are different components of an individual's tax return. There are many different types of Form 1099, but Form 1099 is most commonly given to independent contractors to remit tax information relating to payments they received during the tax year. This information is used to complete Form 1040, as the financial records listed on Form 1099 are input into Form 1040.
The Bottom Line
Form 1040 is the central part of tax filing for United States citizens. It is the tax form that all taxpayer financial statements eventually feed into and support tax schedules branch out of. Regardless of an individual's filing status or income, taxpayers who file taxes will complete some version of Form 1040.
