Business & Finance Taxes

A Guide To The Most Common Tax Forms

Tax filing is never an easy process, but it becomes much more complicated if you try to do it all by yourself. Without assistance from an experienced preparer, it's hard to even get the forms required, let alone fill them out correctly and ensure that everything is accurate. Understanding the basic forms that you're likely to encounter will help if you're determined to tackle tax filing on your own, although it's important to remember that you're risking a lot by avoiding hiring a professional.

1040EZ

These are the easiest to deal with out of the bunch. Designed for individuals with income falling below the $100,000 threshold, this is a simplified return. All that (usually) needs to be filed is the 1040EZ itself, which dramatically cuts down on both time and complexity. However, if you have anything beyond the most basic of returns, you may be ineligible even if you do fall under the income threshold.

1040A

This is the next step up in complexity. It offers a fair amount of flexibility when compared to the EZ, but it is still very difficult for an individual to complete without guidance from a professional. This is what the majority of people will end up using. If you're not sure what best suits you, this is considered a good place to start. This is the first form that has schedules attached to it. Though strangely named, schedules are in fact another type of document. They might accurately be described as supplements or additions. Their purpose is to provide supplementary information - for instance, claims of interest, child care expenses, and other similar situations.

1040

The regular 1040, known by professionals as the "long form," earns its name. It's a guaranteed fit, able to cover all potential situations that you might encounter. However, it also has an extraordinary array of schedules attached to it. This is what you'll be using if you itemize your deductions, owned a business, use the Earned Income Credit, were self-employed, or any one of a host of other possible situations. All of these schedules are substantial and take time to complete.

Additional Forms

A long list of other filing documents exists from the IRS, although it's unlikely that the average taxpayer is going to need to file all of them. If you have a situation that isn't covered by schedules attached to the 1040, you are strongly advised to turn to a professional advisor for assistance. He or she will be able to better direct you, especially if you're required to submit anything beyond what's typical or usual. Keep in mind that there is a reason so many people choose to prepare taxes for a living: doing it right is a tough, complex job that requires a lot of specialist knowledge.

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