What US Taxpayers Need to Know About the NEW Form 1040

SeaBreeze

SeaBreeze

Endlessly Groovin'
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My husband does our taxes, we'll see if it's any simpler with the new 1040. Does anyone think this will be helpful during tax time? More about it here.

Taxpayers will be in for a surprise when they file their 2018 federal income tax returns next year as the Internal Revenue Service recently announced plans to streamline the Form 1040 into a shorter, simpler form for the 2019 filing season. A draft of the new form reveals it to be much shorter than the old one – reduced from 79 lines to 23. The new form is expected to replace the current Form 1040 as well as the shorter Forms 1040A and 1040EZ traditionally used by taxpayers with less complex tax situations.

Here are a few things to know about the new tax form.

First, it is not a postcard, although that seems to be the form's new nickname. It is larger than the average postcard and is not formatted for mailing. One side contains personally identifiable information, including legal names, addresses and Social Security numbers, so an envelope will be required along with a stamp and a trip to the post office for those who file on paper.

Second, all of those lines removed from the form contained important information that needs to be reported elsewhere for an individual's income to be properly reported, and for the tax to be properly calculated. The result is six new numbered schedules, or attachments, which will feed into the new, shorter Form 1040. They are as follows:


  • Schedule 1: Additional Income and Adjustments to Income (37 lines)
  • Schedule 2: Tax (7 lines)
  • Schedule 3: Nonrefundable Credits (10 lines)
  • Schedule 4: Other Taxes (12 lines)
  • Schedule 5: Other Payments and Refundable Credits (14 lines)
  • Schedule 6: Foreign Address and Third-Party Designee (3 rows of information)

What does this mean for taxpayers? While the final verdict is still out, shorter may not mean simpler. Many of the lines on the new form and schedules link to other forms containing external calculations, and results from one page often transfer from that page to another page, or schedule, elsewhere in the tax return. For example, capital gains and losses will be reported on one of six forms 8949 before flowing to the Schedule D, then to the Schedule 1 and then to the Form 1040. Is this really simpler? Time will tell.
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If this is like nearly everything the government "improves", there will probably be some Startup issues. I will most likely stay with using the H&R Block CD I get every year, and let their team of accountants, etc., figure out how these changes work....at least, that way, if something gets messed up, H&R will fix it.
 
Don M. said:
If this is like nearly everything the government "improves", there will probably be some Startup issues. I will most likely stay with using the H&R Block CD I get every year, and let their team of accountants, etc., figure out how these changes work....at least, that way, if something gets messed up, H&R will fix it.
Click to expand...


I've always done my own taxes... but when I turn 70 and begin taking RMD [and it's related draconian IRS rules]
I will probably seek professional tax help. If you don't mind me asking... what is H&R's cost. Can they also help
with tax planning?

.
 
KingsX said:
I've always done my own taxes... but when I turn 70 and begin taking RMD [and it's related draconian IRS rules]I will probably seek professional tax help. If you don't mind me asking... what is H&R's cost. Can they also help with tax planning?.
Click to expand...

I've been doing my own taxes with the H&R Block CD's, for several years...with NO problems. They usually charge about $35 for the Federal, and an extra $5 for State (as I recall), and I can usually get my taxes done in about an hour or two. The Fed taxes are filed electronically, and I just print off the State stuff, and send it in the mail. This past year, I filed at the end of January, and had both refunds by mid Feb. Unless a person has a very complex tax filing...runs a business, etc., this is the Best method I've found for doing taxes. TurboTax also has a good reputation, but I've had good results with H&R, so I just stick with them. As for planning, they have several sections on their program that can help a person plan for the next years taxes, if their incomes, etc., might be changing.
 
Oh boy....I wonder what the tax prep programs are going to do with this change. Seems like they may be going from Washington (DC) to Canada to get to Florida with this one. Time sure will tell how this works out.
 

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