Why use form 1040ez

Individuals choosing the A can file using any of the five available filing status options: single, married filing jointly or separately, qualifying widow or widower, or head of household. People who file the A also can claim, in addition to the EITC, several tax credits — the child, additional child, education, dependent care, elderly or disabled, and retirement savings credits — that are not available with the EZ.

Form A also gives you the chance to claim several adjustments to income. These items are sometimes referred to as above-the-line deductions, because you claim them just before the bottom line of the form, the one where you enter your adjusted gross income.

By reducing your total gross income, your taxable income will be lower and your tax bill should be smaller, too. Adjustments allowed on Form A include educator expenses, certain IRA contributions, student loan interest, and some college tuition and fees.

Finally, choose Form if your earnings are larger, you itemize deductions or you have more complex investments and other income to report. This usually means added tax paperwork needs to be filed, too. Additional paperwork also is associated with the many tax credits that show up only on the long Form The extra work, however, is offset by the added savings these credits, such as the one for taxes you paid to a foreign country or the one that helps cover some adoption costs, can produce for filers.

The longest tax return also offers more than a dozen above-the-line deductions that you can claim directly on the form itself versus the four adjustments found on the A.

The adjustments include, among other things, breaks for alimony payments you made, self-employment taxes you paid or moving expenses you incurred.

You will, however, have to fill out an additional form or schedule to claim a couple of these breaks. If your situation has changed — say, you now have enough deductions to make itemizing worthwhile — then file a different form.

Compare CD rates today. How We Make Money. Kay Bell. Written by. Share this page. Key Principles We value your trust. You can file the EZ return if: Your filing status is single or married filing jointly. Your spouse also must meet the age requirements if you file a joint return.

You or your spouse if filing jointly were not legally blind during the last tax year. You have no dependents. You have capital gain distributions, but no other capital gains or losses.

You do not itemize deductions. You itemize deductions. You have self-employment income. You received income from the sale of property. Related Links: 7 ways tax laws could change under the Donald Trump tax plan 10 key tax terms to know Do you have to file taxes? For most individuals, the EZ was the first tax form they ever completed. Consider a typical high-school student employed part-time. Provided they met the income qualifications, the EZ will likely be the most straightforward and appropriate form to file.

Form EZ had only a few credits or deductions available to taxpayers. Filers were able to include an earned income credit EIC and elect nontaxable combat pay. One significant difference was that Form had fields to include information about dependents, while EZ did not allow individuals to claim dependents. The filer was also able to include unemployment compensation payments. Form EZ allowed filers to claim income from wages, tips, salaries, taxable grants or scholarships, the Alaska Permanent Fund, and unemployment compensation.

Form , though, had at least 16 income categories. Categories available on the standard form included dividend payments, retirement account distributions, and farm and rental income. Form also allowed the entry of Social Security benefits, alimony, and other forms of income. This form also had a long list of deductions, ranging from education costs to healthcare savings plan contributions.

Accessed Feb. Income Tax. Finances With Children. Your Privacy Rights. To change or withdraw your consent choices for Investopedia. At any time, you can update your settings through the "EU Privacy" link at the bottom of any page. These choices will be signaled globally to our partners and will not affect browsing data. We and our partners process data to: Actively scan device characteristics for identification.

I Accept Show Purposes. Anyone who fits the criteria set forth by the IRS is eligible to use it. Anyone filing income taxes who does not meet the list of criteria much file either a Form or Form A. For most individuals, Form EZ is what they use the first time they file taxes for a part-time or summer job in high school or college. As they age, get married, start a career or make investments, they move on to more complicated forms. Need help with your income taxes? If you live in or work for a company in Mississippi, you might have to file a state income tax return.

Maine residents will fall into one of three tax brackets. Indiana has a flat income tax, meaning you pay the same tax rate regardless of income. This deduction allows some taxpayers to deduct the money they spend on state and local taxes.