Important Reminders for the Upcoming 2019 Filing Season
By Mark Castro, CPA
January 2, 2019
This is a reminder that the IRS has redesigned the 2018 Form 1040. The Form 1040 will only include the most commonly used income, deductions, credits and payments. All other line items that were on the previous Form 1040 will now be included on six new schedules.
With this redesign the Form 1040A and 1040EZ has been eliminated.
The 2018 Form 1040 has been streamlined to only include the five most common types of income, federal withholding, EITC, Additional Child Tax Credit and the Education Credit. All other types of income, adjustments to income, nonrefundable, refundable credits, other payments and other taxes that existed on the 2017 Form 1040 have been moved to one of six new schedules:
- Schedule 1 (Additional Income and Adjustments to Income)
- Includes the remaining income types such as from Schedule C, D, E and F, unemployment compensation, etc. that were shown on the current Form 1040.
- All adjustments to income such as Educator expenses, IRA contributions, student loan interest, etc.
- Schedule 2 (Tax) – Includes all lines that are used to calculate total tax such as the regular tax, tax on child’s unearned income, alternative minimum tax, etc.
- Schedule 3 (Nonrefundable Credits) – Includes all nonrefundable credits such as credit for child and dependent care expenses, education credits, child tax credit and the new credit for other dependents, etc.
- Schedule 4 (Other Taxes) – Includes all other taxes such as self-employment tax, household employment tax, etc.
- Schedule 5 (Other Payments and Refundable Credits) – Includes the lines for other payments and refundable credits such as extension payment, credit for federal tax on fuels, etc.
- Schedule 6 (Foreign Address and Third Party Designee) - Where foreign address and third party designee information is shown if they are applicable.
The 2018 Form 1040 also has the following changes that are a result of the Tax Cuts and Jobs Act:
- Removal of exemption amount boxes and the total exemptions line.
- Addition of check box for the new credit for other dependents for each dependent.
- New line 9 for the new qualified business income deduction (20% deduction for pass-through business income – Sec 199A).