2018 Tax Year (Standard & Itemized Deduction)

This Blog will explain the Standard Deduction and Itemized Deduction that are available to Taxpayers for the 2018 Tax Year. The Standard or Itemized Deduction is reported on the Bottom Half of the new “1040 Simplified” tax form, and uses the Schedule A to total the Itemized Deductions the Taxpayer qualified to use for the 2018 Tax Year.


Feel free to send me an email at Mike@TaxesAreEasy.com

Blog Written Content ©2018 Michael D Meyer. All rights reserved.

PDF IRS forms, instructions & publications – ©2018 Department of the Treasury Internal Revenue Service IRS.gov


Legal Disclaimer: Nothing written or expressed in this Blog shall be construed as legal, accounting, or tax advice. This Blog is for informational purposes only, to inform Individuals about the IRS tax forms required to file an individual tax return, and the instructions that accompany such IRS tax forms.

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any tax transaction or filing any tax form.

2018 Tax Year (Schedule 1) Adjustments to Income

This Blog will explain the Schedule 1 – Adjustments to Income categories that are available to Taxpayers for the 2018 Tax Year.


Line 23: Educator Expenses

Line 24: Certain business expenses of reservist, performing artists, and fee-based government officials. Attach form 2106.

Line 25: Health savings account deduction. Attach Form 8889.

Line 26: Moving expenses for members of the armed forces. Attach form 3903.

Line 27: Deductible part of self-employment tax. Attach Schedule SE

Line 28: Self-employed SEP, SIMPLE and qualified plans

Line 29: Self-employed health insurance deduction

Line 30: Penalty on early withdrawal of savings

Line 31a: Alimony paid & Line 31b: Recipient’s SSN

Line 32: IRA deduction

Line 33: Student loan interest deduction

Line 34: Reserved

Line 35: Reserved

Line 36: Add lines 23 through 35

Line 37: Subtract line 36 from line 22. Enter here and on Form 1040, line 6


Feel free to send me an email at Mike@TaxesAreEasy.com

Blog Written Content ©2018 Michael D Meyer. All rights reserved.

PDF IRS forms, instructions & publications – ©2018 Department of the Treasury Internal Revenue Service IRS.gov


Legal Disclaimer: Nothing written or expressed in this Blog shall be construed as legal, accounting, or tax advice. This Blog is for informational purposes only, to inform Individuals about the IRS tax forms required to file an individual tax return, and the instructions that accompany such IRS tax forms.

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any tax transaction or filing any tax form.

2018 Tax Year (Schedule 1) Additional Income

This Blog will explain the Schedule 1 – Additional Income categories that are available to Taxpayers for the 2018 Tax Year.


Lines 1 – 9b: Reserved

Line 10: Taxable refunds, credits, or offsets of state and local income taxes

Line 11: Alimony received

Line 12: Business income or (loss). Attach Schedule C or C-EZ

Line 13: Capital gain or (loss). Attache Schedule D if required.

Line 14: Other gains or (losses). Attach Form 4797

Line 15a: Reserved

Line 16a: Reserved

Line 17: Rental real estate, royalties, partnerships, S corporations, trusts, etc. Attache Schedule E

Line 18: Farm income or (loss). Attach schedule F

Line 19: Unemployment compensation

Line 20a: Reserved

Line 21: Other income. List type and amount

Line 22: Total additional income


Feel free to send me an email at Mike@TaxesAreEasy.com

Blog Written Content ©2018 Michael D Meyer. All rights reserved.

PDF IRS forms, instructions & publications – ©2018 Department of the Treasury Internal Revenue Service IRS.gov


Legal Disclaimer: Nothing written or expressed in this Blog shall be construed as legal, accounting, or tax advice. This Blog is for informational purposes only, to inform Individuals about the IRS tax forms required to file an individual tax return, and the instructions that accompany such IRS tax forms.

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any tax transaction or filing any tax form.

2018 Tax Year (Income)

This Blog will explain the Income categories that are reported to Taxpayers for the 2018 Tax Year. Income is reported on the Bottom Half of the new “1040 Simplified” tax form on lines 1 through 6. Taxpayers will also use the new Schedule 1 to list the individual categories of their Additional Income.


Line 1: Wages, salaries, tips, etc.

Line 2a: Tax Exempt Interest & Line 2b: Taxable Interest

Line 3a: Ordinary Dividends & Line 3b: Qualified Dividends

Line 4a: IRAs, Pensions, Annuities & Line 4b: Taxable amount

Line 5a: Social Security Benefits & Line 5b: Taxable amount

Line 6: Additional Income and Adjustments to Income. Attach Schedule 1.


Feel free to send me an email at Mike@TaxesAreEasy.com

Blog Written Content ©2018 Michael D Meyer. All rights reserved.

PDF IRS forms, instructions & publications – ©2018 Department of the Treasury Internal Revenue Service IRS.gov


Legal Disclaimer: Nothing written or expressed in this Blog shall be construed as legal, accounting, or tax advice. This Blog is for informational purposes only, to inform Individuals about the IRS tax forms required to file an individual tax return, and the instructions that accompany such IRS tax forms.

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any tax transaction or filing any tax form.

2018 Tax Year (Dependents)

This Blog will explain the Dependent deduction choices that are available to Taxpayers for the 2018 Tax Year. Dependents are listed on the Top Half of the new “1040 Simplified” tax form.


A Dependent is an IRS tax definition that means a Qualifying Child, a Qualifying Relative, or an Other Dependent. The Dependents you claim on your tax return are listed in the middle Top Half of the new “1040 Simplified” tax form. If you list more than two Dependents, the tax software will list them on a second page.

The IRS has tests each Dependent must meet – to qualify to be listed as your Dependent on the tax return. See below.

This link for Publication 501-Exemptions, Standard Deduction & Filing Information gives the IRS definitions and explanations for:

  • Filing Status
  • Filing Requirements
  • Definitions of Dependents
  • Personal and Dependent Exemptions (Obsolete for the 2018 Tax Year)
  • Standard Deduction

It is a terrific resource for the IRS explanations for Dependents. I will update the link, when the IRS releases the 2018 version of the publication.


Qualifying Children are defined by five IRS tests they have to meet. If the Child you are attempting to claim as a Dependent on your tax return meets all (5) of these tests – then you can claim them, listed as a Qualifying Child on your tax return.

  • Relationship to you, the taxpayer claiming them as a Dependent
    • Son, daughter, stepchild, foster child, brother, sister, stepbrother, stepsister, half brother, half sister, or a descendent of any of them, for example your grandchild, niece or nephew
  • Age on December 31st of the tax year
    • Under age 19 at the end of the tax year and younger than you, or your spouse if filing jointly
    • Under age 24 at the end of the tax year, a student, and younger than you, or your spouse if filing jointly. A student is your Child who during any part of 5 calendar months of the tax year, was enrolled as a full-time student at a qualified school.
  • Support provided by the Child
    • The Child cannot provide over half of his/her support during the tax year. Support is generally defined as living expenses.
  • Residency
    • The Child must have lived with you, for more than half of the year. This includes “temporary absences” like attending college, as long as the student’s belongings and permanent residence is still with you.
  • Joint Filing
    • The Child you are claiming as a Dependent, cannot file a Joint tax return with their spouse, except for one exception. That Child can only file a Joint tax return with their spouse, to claim a refund of withheld tax.

Qualifying Relatives are defined by four IRS tests they have to meet. If the Person you are attempting to claim as a Dependent on your tax return meets all (4) of these tests – then you can claim them, listed as a Qualifying Relative on your tax return.

  • Not a Qualifying Child of you or any other taxpayer
    • The person you are attempting to claim as a Qualifying Relative, cannot satisfy all the tests as a Qualifying Child of any other taxpayer, including yourself – even if you or another taxpayer do not claim them.
  • Relationship to you, the taxpayer claiming them as a Dependent
    • Son, daughter, stepchild, foster child, or a descendent of any of them, for example your grandchild
    • Brother, sister, half sister, or a son or daughter of any of them, for example your niece or nephew
    • Father, mother, or ancestor or sibling of either of them, for example your grandmother, grandfather, aunt or uncle
    • Stepbrother, stepsister, stepmother, stepfather, son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, sister-in-law
    • Any other person (other than your spouse) who lived with you for the entire 12-months of the year, as a member of your household.
  • Gross Income test
    • The taxable income of the Qualifying Relative must be below the Maximum Income Amount for the tax year. It is $4,150 for the 2018 tax year. This amount typically increases each year for inflation. Some income like Social Security Benefits, does not count towards this Gross Income test. The IRS gives clear instructions what income to include.
  • Support test
    • You must provide over half of the person’s support. Support is generally defined as living expenses. The IRS provides worksheets to help properly determine if you indeed provided more than 50% of the Support for this Qualifying Relative you are attempting to claim.

Most of the relatives listed above in the Relationship category, do not have to live with you the entire year – to still be listed as your Qualifying Relative. They must live with you for over six months of the year.

Your parents can even live separately from you, as long as you provide over 50% of their support. You can therefore claim them as Qualifying Relatives, provided they also meet the other tests.

Only an Other Dependent that is not defined as your relative from the lists above – must live in your household for the entire year. For example, your Cousin or other distant relative, your Girlfriend, Boyfriend and their children, or Friend.

See page 19 of the Publication 501-Exemptions, Standard Deduction & Filing Information for the list of “Relatives who don’t have to live with you the entire tax year” in your household – to still qualify them as one of your Qualifying Relative dependents.


Dependent Related Credits:

If your Qualifying Child is under the age of 17, at the end of the 2018 tax year, you might qualify for the $2,000 Child Tax Credit. Up to $1,400 of this credit can be refundable to you, under the Additional Child Tax Credit. This credit is available for taxpayers with Adjusted Gross Incomes below $400,000 for a Married Filing Jointly couple, and below $200,000 for all other taxpayers using a filing status other than Married Filing Jointly.

A new nonrefundable credit is available for each Dependent, who does not qualify for the Child Tax Credit. This is a new $500 credit called the Family Credit. The same income levels apply for this credit, as listed above.


Click the link below for the next Blog post to learn about the Income categories reported to the new form “1040 Simplified”.

2018 Tax Year (Income)


Feel free to send me an email at Mike@TaxesAreEasy.com

Blog Written Content ©2018 Michael D Meyer. All rights reserved.

PDF IRS forms, instructions & publications – ©2018 Department of the Treasury Internal Revenue Service IRS.gov


Legal Disclaimer: Nothing written or expressed in this Blog shall be construed as legal, accounting, or tax advice. This Blog is for informational purposes only, to inform Individuals about the IRS tax forms required to file an individual tax return, and the instructions that accompany such IRS tax forms.

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any tax transaction or filing any tax form.

2018 Tax Year (Filing Status)

This Blog will explain the (5) Filing Status choices that are available to Taxpayers for the 2018 Tax Year. Filing Status is indicated on the Top Half of the new “1040 Simplified” tax form.


Filing Status tells the IRS what category of taxpayer you are – as defined by your marital status on December 31st of each tax year. Filing Status can also be affected by your household situation – if you support children, relatives or friends living in your home.

Each tax year, you have to tell the IRS on your tax form if you are considered Single, Married Filing Jointly, Married Filing Separately, a recent Widow(er) supporting your children, or a Single person supporting and providing a household for children, relatives or friends. The (5) Filing Status categories accommodate these scenarios.

Filing Status is important because the Standard Deduction, the Tax Rate Tables and many Adjustments, Deductions and Credits are based on your Filing Status. You might qualify for more than one Filing Status, so you would choose the one that gives you the best tax benefits. For example, some people can file as Single or Head of Household. Head of Household usually gives the taxpayer a more favorable tax treatment than Single.

This link for the 2017 Tax Year Publication 501-Exemptions, Standard Deduction & Filing Information gives the IRS definitions and explanations for:

  • Filing Status
  • Filing Requirements
  • Definitions of Dependents
  • Personal and Dependent Exemptions (Obsolete for the 2018 Tax Year)
  • Standard Deduction

It is a terrific resource for the IRS explanations for Filing Status. I will update the link, when the IRS releases the 2018 version of the publication.


Single is the first filing status you consider. It means that you were not legally married on December 31st of the tax year. If you are the only person listed on the new “1040 Simplified” form, and you do not list Children or Dependents, the IRS assumes your filing status is Single. There is no checkbox on the form for Single.

The scenarios that define you as Single are:

  • You were never married in that tax year.
  • You were legally separated or divorced by December 31st of the tax year.
  • You were recently widowed and did not remarry in the tax year immediately following the year your spouse died.
    • Typically you would have the filing status of Married Filing Jointly or Separately, in the year your spouse dies. It is the following year you could be considered Single.
  • You did not support your own children or relatives in your household.
  • You could have supported one or more non-relatives in your household, and still use the Single filing status. See that explanation below:

If a non-relative lived with you the entire year, and you provided for their financial support, they could qualify as an Other Dependent. You would still use the Single filing status, as these non-relative Dependents would not qualify you for the Head of Household filing status.

For example, you could claim your Girlfriend and her child, as non-relative Dependents on your Single tax return, if they lived with you the entire year, and you provided for their financial support. Neither of them could have income above a certain threshold defined by the IRS each year.


Married Filing Jointly (even if only one had income) is the filing status where you and your spouse combine both of your Incomes and Deductions onto one tax return. You also are both equally liable for any tax due on the jointly filed return. You can also lists dependent Children or Other Dependents on your tax return, with this filing status.

If you as the Taxpayer, and your Spouse, are the only persons listed in the header of the new “1040 Simplified” form, the IRS assumes your filing status is Married Filing Jointly. There is no checkbox on the form for Married Filing Jointly.

The scenarios that define you as Married Filing Jointly are:

  • You were married as of December 31st of the tax year, and lived together the entire tax year. Both of you had income to report.
  • You were married and lived together the entire year, and only one spouse had income to report.
  • You were newly married in the current tax year, and remained married as of December 31st. You have to file as a Married couple, even though you weren’t married the entire year. Your status on Dec. 31st is what counts.
  • You were married as of December 31st of the tax year, even if you didn’t live with your spouse on December 31st. You both still can choose to file jointly and report your combined Income and Deductions to the IRS.
  • Your spouse died in the tax year, and you did not remarry in the tax year.
  • You were married as of December 31st, but your spouse died early in the following year before the April 15th tax filing deadline. You still file as Married Filing Jointly or Separately, as that was your marital status on December 31st, of the year prior to the death of your spouse.
    • You will also file as Married Filing Jointly or Separately, in the year your spouse died, as explained earlier. So long as you did not remarry in the year your spouse died.

Married Filing Separately is the filing status where you and your spouse report your Income and Deductions separately on two distinct and separate tax returns. This is essentially each married spouse filing as a Single person, except you are not allowed to use the Single filing status – if you were legally married on December 31st of the tax year. A married couple can only file Jointly or Separately, except under special circumstances when children are involved, and the spouses have not lived together the last six months of the year. In that case, one spouse could possibly qualify to use the Head of Household filing status, and claim the children as dependents on their tax return.

Married Filing Separately is most often the least advantageous filing status, because many Adjustments, Credits and Deductions are not allowed when you use this filing status. Congress wrote these restrictions into the Tax Laws, as they frequently write tax law to be more advantageous to a Married couple, in this case to a Married Filing Jointly couple.

You would check the box that says “Married filing separate return” and you list your spouse’s social security number on your tax return.


Qualifying Widow(er) (with dependent child) is the filing status to use when your spouse died the year before the current tax year, and you still are supporting your young children. You can qualify to use this Filing Status for the two tax years after the year your spouse died. It gives you the best tax treatment, as it uses many of the values for the Married Filing Jointly filing status. It is more advantageous than using the Head of Household filing status.

For example, your spouse died in 2017 and you are still raising two young Children. For the 2017 tax year your spouse died, you would still use the Married Filing Jointly filing status. For the tax years 2018 and 2019, you would use the Qualifying Widow(er) filing status. Then for the tax year 2020 and beyond, you would use the Head of Household filing status. It is designed to give you an extra financial buffer, for those first two years after your spouse died, and you remained unmarried supporting your children.

You would check the box that says “Qualifying widow(er)” and you would list your children as dependents on your tax return.


Head of Household (with qualifying person) is the filing status where you are considered “Unmarried”, and you also financially support one or more Dependents in your household. You could be supporting a child or relative as they live in your household – and you provide for their living expenses. These Dependents are either Qualifying Children and/or Other Qualifying Relatives. They must be related to you, as defined by the IRS rules. The next blog post defines Dependents.

The (3) tests you must meet to use the Head of Household filing status are:

  1. You are unmarried, or considered unmarried, on the last day of the tax year, on December 31st.
  2. You paid more than half of the cost of keeping up your home for the tax year. The IRS provides a worksheet to calculate this.
  3. A qualifying person, that you list as a Dependent on your tax return, lived with you for more than half of the tax year, including temporary absences like a child at college. A dependent parent does not have to live with you.

In some circumstances the Dependent does not have to live in your household, and you can still qualify to use the Head of Household filing status. For example, your parent can be living in a nursing home, but you still provide the majority of their support, or their living expenses. You could claim them as a Qualifying Relative – which would allow you to use the more advantageous Head of Household filing status, versus for example the Single filing status. The parent would just have to meet all (4) of the IRS tests, to still qualify as your Qualifying Relative. For example, their taxable income could not exceed the Gross Income Limit amount each year. This is called the Gross Income test. There are (3) other IRS tests they must meet.

See page 19 of the Publication 501-Exemptions, Standard Deduction & Filing Information for the list of “Relatives who don’t have to live with you in your household the entire year” – to still qualify you to use the Head of Household filing status. They do, though, have to live with you for over 6-months in the year. These are considered Qualifying Persons, as they are related to you, as specified in this list on page 19.

A friend who is not a relative as defined above, would not be a Qualifying Person, even if they lived with you the entire year. For example a girlfriend or boyfriend, and possibly their children. If these people lived with you the entire year, and you financially supported them, you would qualify to use the Single filing status and could list them as Dependents. You cannot, though, use them as Qualifying Persons for the Head of Household filing status. They must be related to you, as defined on page 19 of Pub. 501.

A spouse of a married couple could be considered “Unmarried”, if the couple did not live together the last six months of the year. That “Unmarried” spouse could then possibly list Qualifying Children as Dependents on their tax return, and qualify to use the Head of Household filing status, instead of the less advantageous Married Filing Separately filing status. The children would just have to meet all of the (5) IRS tests that would define them properly as Qualifying Children.

This is by far the most complicated, and abused, Filing Status category. Many taxpayers try to qualify for the Head of Household filing status, only to have the IRS disallow it after they are audited. Competent tax preparers will help you with this, to make certain you meet all the requirements.

Starting with the 2018 tax year, the IRS will fine tax preparers $505 per occurrence, if they don’t use proper due diligence in qualifying their Clients for the Head of Household filing status. Therefore your tax professional will ask for proof, that the dependents are your relatives, and you met all the other requirements of the Head of Household filing status. Tax preparers must fill out form 8867 to prove their due diligence Form 8867 Preparer Due Diligence . This is the 2017 version, that already makes tax preparers prove due diligence for the Earned Income Credit, the Child Tax Credit/Additional Child Tax Credit, and the American Opportunity Education Credit. I will update to the 2018 version when available.

You would check the box that says “Head of household” and you would list your qualifying children or relatives as dependents on your tax return.


Click the link below for the next Blog post to learn about which Dependents you can list on your tax return.

2018 Tax Year (Dependents)


Feel free to send me an email at Mike@TaxesAreEasy.com

Blog Written Content ©2018 Michael D Meyer. All rights reserved.

PDF IRS forms, instructions & publications – ©2018 Department of the Treasury Internal Revenue Service IRS.gov


Legal Disclaimer: Nothing written or expressed in this Blog shall be construed as legal, accounting, or tax advice. This Blog is for informational purposes only, to inform Individuals about the IRS tax forms required to file an individual tax return, and the instructions that accompany such IRS tax forms.

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any tax transaction or filing any tax form.

What Tax Form Should I Use? (2018 tax year)

The IRS introduced a new single page 1040 form in June 2018, for the upcoming 2018 tax year. It is designed to be folded in half and mailed, if you are a taxpayer who still mails in your tax return. The IRS also introduced (6) new Schedules, numbered 1 through 6, to support this new 1040 form.

The previously used tax forms, the 1040EZ, 1040A, and the long 1040, have been retired by the IRS. They will not be used for any tax year after the most recently completed 2017 tax year. For the 2018 tax year and beyond, the new single page 1040 form will be used.

Only a relatively few number of taxpayers will have such a simple “Tax Story” that they can mail in the new 1-page 1040 form. Most taxpayers will need to use one or more of the (6) new Schedules, to list their additional sources of Income, Adjustments, Credits, Taxes and Payments. If so, they would have to include the required new Schedules with their mailed in tax return, that is designed to be folded in half and mailed.

Most taxpayers, over 90% according to the IRS, either use tax software to self-prepare their own tax return, or hire a tax professional to complete and file their tax return. That 90% of the taxpayer population will benefit from updated tax preparation software, that will automatically handle the new tax forms. Software like TurboTax® will be updated, as well as the professional software every tax professional uses to prepare and file a Client’s tax return.

What will be new is the final PDF copy, or paper printout of your 2018 tax return. Your tax information will be displayed on this new 1040 tax form, with one or more of the new (6) Schedules.

I explain the new 1040 form and the (6) new Schedules below, as to the new forms organization methodology the IRS is using, to populate your tax return information onto this new 2018 tax year return.

The IRS started publishing the drafts of these forms in late June 2018, and will continue issuing draft forms for comment and revision until the late Fall 2018. I will keep the form images in this Blog current, with the most recent IRS draft forms, as they are updated throughout the year.

Updated forms to this Blog on 08/14/2018.


This is the top half of the new 1040 form

This is the Informational part of the new 1040 form. You describe the people listed on the tax return and define your filing status.

You answer questions about your Standard Deduction, and indicate that your Spouse is using Itemized Deductions, if you both are using the Married Filing Separately filing status.

You decide if you want $3 to go to the Presidential Election Campaign fund. You indicate if you had health insurance coverage for all of 2018.

You also sign and date your tax return, describe your and/or your spouse’s occupation, and list the paid preparer information, if a tax professional prepared the tax return on your behalf. You also indicate if you want your tax professional to be a 3rd Party Designee, which gives them permission to speak to the IRS, on your behalf, about the processing of your tax return.

If the IRS issued you or your spouse an Identity Protection PIN, you list that on this form. This guarantees the IRS only will accept a tax return from you, as they match the PIN to your personal information. If it does not match your information on record with the IRS, the tax return will be rejected.

Below is a line-by-line summary of the top half of the form:

  1. List your first and last name and your social security number.
    1. Add your middle initial if that is listed on your social security card
  2. List your Spouse’s first and last name, and their social security number
    1. Add Spouse’s middle initial if that is listed on their social security card
  3. Filing Status
    1. If you are Single, check that box.
    2. If you are Married Filing Jointly, check that box.
    3. If you are Married Filing Separately, you must list your Spouse’s social security number. Check the box Married Filing Separately.
    4. If you are using the Head of Household filing status, check that box
    5. If you are using the Qualifying Widow(er) filing status, check that box
  4. Standard Deduction information for the Primary taxpayer, listed first
    1. Check the box if someone can claim you as a Dependent on their tax return, such as a Parent
    2. Check the box if you were over age 65, at the end of 2018. This would mean you were born before January 2nd, 1954
    3. Check the box if you are blind
  5. Standard Deduction information for the Spouse, listed second
    1. Check the box if someone can claim you as a Dependent on their tax return, such as a Parent
    2. Check the box if you were over age 65, at the end of 2018. This would mean you were born before January 2nd, 1954
    3. Check the box if you are blind
    4. Check the box if your spouse itemized their deductions on a Married Filing Separately tax return.
    5. Check the box if you were a dual-status alien. This means you were a non-resident alien part of the year, and a resident alien the other part of the year.
  6. Fill in your full address, that you want the IRS to mail notices to
    1. If you list a Foreign Address, add that to the new Schedule 6.
  7. Check the box(s) if you want $3 to be allocated to the Presidential Election Campaign fund, on your and/or your spouse’s behalf. This will not decrease your refund, nor increase your tax due. It just transfers $3 from the Federal Government general fund, into this fund, in your name. See this Wikipedia link $3 to the Presidential Election Campaign.
  8. Check the box if you had qualified health insurance coverage for the entire 2018 tax year. There is still a penalty for the 2018 tax year, if you did not have health insurance for every month in 2018. The penalty will be zero, starting with the 2019 tax year, and for the tax years after 2019.
  9. List any Dependents you support in your household
    1. First & Last Name, social security number, and their relationship to you
    2. Check if they qualify for the Child Tax Credit, or the Credit for Other Dependents. The Child has to be under the age of 17 at the end of 2018, to qualify for the Child Tax Credit. The Other Dependent has to be someone you supported in your household, who does not qualify to be listed as your Dependent Child, and qualifies to be listed as an Other Dependent.
  10. You and/or your spouse must sign and date the tax return, and list each of your occupations. If the IRS has issued you and/or your spouse an Identity Protection PIN, you must list that on your tax return. The IRS uses this PIN to verify this is indeed your tax return. They will reject the tax return, if your personal information and the PIN does not match the information they have on record for you and/or your spouse, in their computers.
  11. The Paid Preparer must sign and date the tax return, if a tax professional prepared your tax return, and mailed / e-filed on your behalf. They also must list their PTIN number and their firm’s information. The PTIN is the Preparer Tax Identification Number, which is the registration number all paid preparers must have on record with the IRS, if they prepare tax returns for compensation. Do not use a tax preparer, if they don’t have a PTIN.
  12. 3rd Party Designee election. If this box is checked, you assign the tax preparer to be your 3rd Party Designee, for one year until the filing date the following year, usually April 15th. You are giving the tax preparer permission to call the IRS on your behalf, to answer any questions the IRS has about the processing of your tax return, the progress of the refund, or the processing of any payments you made. This does not give the tax preparer permission to represent you before the IRS, for any Examination, Audit, Collection, Payment Agreement, or Appeals matter. For those representation matters, you should sign a Power of Attorney with only a CPA, a Tax Attorney, or an Enrolled Agent. These are Enrolled Tax Experts who have permission to practice before the IRS, on behalf of their Clients.

This is the bottom half of the new 1040 form

This is the abbreviated part of the new 1040 form, that previously took almost two pages to report the information about your income and deductions. Information now flows from the (6) new Schedules to the bottom half of this new 1040 form.

This page and the (6) new schedules – calculate and report your Income, Adjustments, Taxes, Nonrefundable Credits, Other Taxes, Refundable Credits, Payments, and Third Party Designee information.

The traditional “lettered” schedules that have been used for years, now flow to the new 1040 form and/or one of the (6) new schedules.

  • Schedule A (Itemized Deductions) flows to line 8 of the new 1040
  • Schedule B (Interest and Ordinary Dividends) flows to line 2b of the new 1040 for Interest, and line 3b of the new 1040 for Dividends.
  • Schedule C (Profit or Loss From Business) flows to Schedule 1, line 12.
  • Schedule D (Capital Gains and Losses) flows to Schedule 1, line 13.
  • Schedule E (Supplemental Income and Loss) flows to Schedule 1, line 17.
  • Schedule SE (Self-Employment Tax) flows to Schedule 4, line 57.

Below is a line-by-line summary of the bottom half of the form:

  1. Income is reported on lines 1 through 5, on the new form 1040
    1. Wages, Salaries, Tips, etc. typically reported on your W-2
    2. Interest
    3. Dividends
    4. IRAs, Pensions and Annuities
    5. Social Security Benefits
  2. Additional income categories are reported on lines 10 through 21 on the new Schedule 1. These numbers then flow to this line 6, defining your Total Income for the tax year.
  3. Your Adjusted Gross Income is calculated on line 7 of the 1040, by adding the values on lines 1 through 6. If you have Adjustments to your income, those are calculated on the Schedule 1, in lines 23 through 36. Those total Adjustments are then subtracted from your line 6 Total Income. That then defines your final Adjusted Gross Income value reported on this line 7.
  4. Line 8 lists your Standard Deduction, or your larger Itemized Deduction, that is calculated on the Schedule A and reported back to this line 8.
  5. Line 9 lists the new 20% deduction for Qualified Business IncomeThis affects self-employed individuals who operate as a Sole Proprietorship. It also affects businesses run as an S-Corp, Partnership, Single-Member LLC or a Partnership LLC. These business entities can now deduct up to 20% of their net income to reduce their final Taxable Income value. There is a phase-out of this new deduction above certain income levels. This new Tax Law was enacted to give these smaller businesses a benefit similar to the new flat 21% tax on Corporations. There are many limitations and qualifications to this new deduction, that affect if the full 20% deduction can be taken. The IRS will clarify the instructions before tax season starts.
  6. Line 10 lists your Taxable Income. This is the value that is used to calculate your Tax Obligation for the tax year, based on your income, adjustments and deductions – listed in lines 1 through 9 above.
  7. Line 11 lists your initial Tax Obligation, calculated from the Tax Tables and from any additional taxes listed on the Schedule 2. Tax from forms 8814 (Parent’s Election to report Child’s Interest & Dividends) and 4972 (Lump Sum Distributions) and Other tax calculation forms are also totaled here.
  8. Line 12 calculates any Nonrefundable Credits you qualify for, that can reduce your line 11 Tax Obligation to zero, but not below zero. These are the Child Tax Credit, the Other Dependent Credit, and any other nonrefundable credits calculated on the Schedule 3.
  9. Line 13 subtracts these Nonrefundable Credits from your Tax Obligation on line 11. Line 13 can be reduced to zero, but not below zero.
  10. Line 14 adds any additional Other Taxes, calculated on Schedule 4.
  11. Line 15 is your Total Tax Obligation, which adds any remaining tax from line 13, to any additional Other Tax listed on line 14.
  12. Line 16 shows any income tax withheld from your paycheck, shown on your W-2 form. It also lists any tax withheld and shown on 1099 forms, like a 1099-G for Unemployment Insurance, or an SSA-1099 for Social Security benefit payments.
  13. Line 17 shows any Refundable Credits you qualify for, and any Other Tax Payments you made or qualified for during the tax year, like Quarterly Estimated Payments. These are calculated on the Schedule 5. The Earned Income Credit (EIC), Additional Child Tax Credit (form 8812), and the Education Credits (form 8863) are listed here also.
  14. Line 18 adds lines 16 & 17, to arrive at your Total Payments.
  15. Line 19 lists your refund amount, if your line 18 Payments, are larger than your line 15 Total Tax.
  16. Lines 20a, b, c, d list the Refund amount you want to receive, and allows you to direct your refund to your bank account, or even to more than one financial account. The form 8888 allows you to split your refund between multiple accounts. For example, you could put half of your refund into your checking account, and the other half into your IRA account.
  17. Line 21 allows you to apply some or all of your refund, towards your 2019 tax year Estimated tax payments.
  18. Line 22 shows the amount of tax you owe, if your line 15 Total Tax, is larger than your line 18 Total Payments. You can also instruct the IRS to directly debit the tax you owe, from your bank account, on any date between when you file the tax return, and the usual April 15th due date. You can also setup a payment agreement, to pay the tax over a longer period of time, although you will pay the IRS additional interest and any applicable penalties until the full balance is paid off.
  19. Line 23 shows the Estimated Tax Penalty, if you owe more than $1,000 of tax and you did not make Estimated Tax Payments during the tax year.

This is the new Schedule 1 (Form 1040)


This is the new Schedule 2 (Form 1040)


This is the new Schedule 3 (Form 1040)


This is the new Schedule 4 (Form 1040)


This is the new Schedule 5 (Form 1040)


This is the new Schedule 6 (Form 1040)


Some final thoughts on this “Tax Simplification” that the President and the members of Congress promised.

  • The President and Congress did not simplify the Tax Code, except for removing the Personal Exemption and doubling the Standard Deduction. They added some provisions that actually add complications, like the line 9 Qualified Business Income deduction.
    • The Child Tax Credit has doubled to $2,000, and the income phase-out levels have been raised substantially, so many more Taxpayers will now qualify for the new $2,000 Child Tax Credit.
  • The President kept his promise, that taxpayers could fill out their tax return on a “post card” to be mailed in. That is why the IRS created the new 1-page 1040 form, that can be folded in half and mailed in. But very few taxpayers have such a simple tax return, that can be solely described on the new 1-page 1040 form, without using one or more of the new (6) Schedules that flow information to the new single-page 1040 form.
  • Congress eliminated popular deductions many taxpayers benefited from
    • There is now a $10,000 per tax return limit, on deducting State & Local Taxes, otherwise known as the SALT deduction
    • Unless you are in the Military, a taxpayer can no longer deduct ordinary Moving Expenses related to moving to a new city for a new job
    • Taxpayers can no longer deduct Unreimbursed Business and Education Expenses related to their salary job. All other Miscellaneous Deductions formerly allowed above 2% of your Adjusted Gross Income – also have been eliminated.
  • As a result of the Standard Deductions being doubled, fewer Taxpayers will be Itemizing their Deductions. Therefore, they will no longer be allowed to gain a deduction for Charitable Contributions, as those are allowed only if you Itemize your Deductions.
  • Taxpayers can no longer deduct Casualty and Theft Losses as an Itemized Deduction, unless incurred because of a Federally Declared Disaster Area.

Software like TurboTax® will be updated to reflect the new tax forms. Your tax professional will be trained to understand the new Tax Laws and forms, and his/her tax software will be updated.

Your final PDF or printed tax returns, though, will have an entirely new look for 2018.


Feel free to send me an email at Mike@TaxesAreEasy.com

Blog Written Content ©2018 Michael D Meyer. All rights reserved.

PDF IRS forms, instructions & publications – ©2018 Department of the Treasury Internal Revenue Service IRS.gov


Legal Disclaimer: Nothing written or expressed in this Blog shall be construed as legal, accounting, or tax advice. This Blog is for informational purposes only, to inform Individuals about the IRS tax forms required to file an individual tax return, and the instructions that accompany such IRS tax forms.

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any tax transaction or filing any tax form.