Helpful Information On The Common IRS Federal Tax Forms

By Michael Diaz. May 7th 2016

If you are filing your taxes for the first time this year, you might be overwhelmed by the amount of paperwork involved in the process. After all, it’s no secret that the federal tax code is mind-numbingly complex. However, you should not be intimidated by the scores of federal tax forms out there. In fact, most of them will not apply to your federal tax return. Here is a helpful list of the most common tax forms that you might see or use this tax season.    

Tax Forms You Might Receive

These are common tax forms that you might receive from an employer, a financial institution or other source. They will help you to accurately file your federal tax return. Please note that this list is not exhaustive.

W-2

Most people will receive a W-2 form from their employer. Employers must complete a W-2 form for each employee that receives compensation for employment. The employer submits a copy of the W-2 form to the employee, the federal government and the state and local tax agencies. Companies must complete and send W-2 forms by January 31.

A W-2 form lists important tax information including your wages, tips, commissions, federal tax withholdings, social security tax withholdings and your Medicare tax withholdings.

The basic function of a W-2 is to let you, your local and state governments and the federal government know how much money you made during the year and how much money your employer withheld from your wages for tax purposes. This information is critical to determining how much you will have to pay in federal and state taxes.    

1099-INT And 1099-DIV

You will receive these forms if you hold money or investments at a bank or financial institution. At the end of the year, the bank or financial institution will send you a form letting you know how much interest or dividends you earned for the year. If you took any capital gains or losses, they will also include this information.  

The purpose of these forms is to let your local and state governments and the federal government know if you earned interest, received dividends or took capital gains or losses during the year. If you earned money, you might have to pay taxes on the amount earned. (For more about the capital gains tax, see Understanding The Rules Of The Federal Capital Gains Tax.)

1098

If you have a home mortgage, your mortgage lender will send you a 1098 form which shows the total amount of interest you paid on your mortgage for the year. This form is important because many homeowners can claim a significant tax break on their mortgage interest payment for the year.

1099-SSA And 1099-R

If you received social security income or took a distribution from an annuity, profit sharing plan, retirement plan, IRA or pension, you will receive one of these two forms.  

Forms You Might Need To Fill Out

These are the common tax forms that you will need to fill out and file with the IRS. Please note that this list is not exhaustive.

Every year, each taxpayer (or couple for married taxpayers filing jointly) will have to fill out one version of the 1040 income tax return form. There are three versions of the 1040.

1040EZ

The 1040EZ tax return is the simplest tax return form in the 1040 series. It is for people with very simple tax returns and should not be used by people with more complex tax considerations. To qualify for the 1040EZ, all of the following conditions must apply:

  • You are filing as single or married filing jointly. For more information on selecting your filing status, see Determining Your IRS Filing Status On Your Federal Income Tax Return.)
  • You (and your spouse if filing jointly) are under 65 and not blind.
  • You do not claim any dependents.
  • Your taxable income is less than $100,000 and is only made up of wages, salaries, tips, unemployment compensation, taxable scholarship and fellowship grants, Alaska Permanent Fund dividends and taxable interest of $1,500 or less.
  • You don’t claim any income adjustments or tax credits other than the earned income credit.
  • You don’t owe any household employment taxes on wages you paid to a household employee.
  • You are not involved in a recently filed bankruptcy case.

1040A

If you do not qualify for the 1040EZ return, you may qualify for the 1040A form which is easier to fill out that the 1040 form. To qualify for the 1040A, all of the following conditions must apply:

  • Your taxable income is less than $100,000 and is only made up of wages, salaries, tips, interest, ordinary dividends (including Alaska Permanent Fund dividends), capital gain distributions, IRA distributions, pensions and annuities, unemployment compensation, taxable social security and railroad retirement benefits and taxable scholarship and fellowship grants.
  • You have not made income adjustments for things other than educator expenses, IRA deductions, student loan interest deductions, and tuition and fees.
  • Your taxes are only determined by using an IRS tax table, the alternative minimum tax, the recapture of an education credit, form 8615 and qualified dividends and capital gains. (For more on the alternative minimum tax, see Understanding The Alternative Minimum Tax .)
  • You do not claim any tax credits other than the credit for child and dependent care expenses, the credit for the elderly or the disabled, education credits, the retirement savings contribution credit, the child tax credit, the earned income credit and the additional child tax credit.
  • You did not have an AMT adjustment on a stock you acquired from the exercise of an incentive stock option

1040

If you do not qualify for the 1040EZ or the 1040A form, then you must file a 1040. The 1040 allows for the reporting of all types of income, deductions and credits. If you plan to itemize your deductions, you will have to use the 1040 form. Although it is more complex than the other two forms, you should note that you might save more money by using the 1040 depending on the deductions and credits that you claim.

Now that you know the common tax forms that you will encounter during tax season, you will be better prepared to file your taxes which can help you to reduce your tax burden. If you have any questions about which form you should file and which deductions and credits you might be eligible for, you should consult a tax consultant or certified public accountant. You can also reference the IRS website for additional information.  

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