Tax time is upon us, and with it comes some confusion and a whole lot of questions regarding IRS Form 1040. If you conduct business as an independent contractor, a freelancer, or a DBA, you will be filing this form. We will answer the most common questions and offer support and guidance to get you ready to file your tax return.
Simply stated, Form 1040 is used by U.S. taxpayers to file their annual income tax returns. The previous forms, 1040EZ and 1040A, ended in the 2018 tax filing year. Form 1040 reports to the IRS your gross income and what portion of the income is taxable after credits and deductions. The document provides a calculation of the taxes you owe or the refund you will receive.
The majority of people in the U.S. file a Form 1040. These include:
Married, single, or widowed, 1040 is the tax form commonly used. The instructions for Form 1040 can be found on the IRS website or by clicking here. If you were born before January 2, 1956, you have the option to use Form 1040-SR. Form 1040-SR is available as an optional alternative to Form 1040 for taxpayers who are age 65 or older. Form 1040-SR uses the exact schedules and instructions as Form 1040 does.
Taxpayers have the option of mailing a paper return or filing electronically. Paper returns are submitted depending on the state you live in. Information can be found in the instructions form.
Electronic filing is the preferred method. E-filing is more efficient and secure and can facilitate the speed at which you receive your refund if you are due a refund. Most CPA and accounting firms will file your 1040 electronically for you.
You’ll need to submit Form 1040 to the IRS by April 15, 2021. Extensions are available, but please be sure to request an extension before the deadline.
No problem. You have three years from the date you filed your 1040 to make an amendment. You will utilize Form 1040X. According to the IRS, you can file Form 1040X to do the following:
We are asked this question quite often, so here are the simple definitions:
Please note: You can receive both a W-2 and 1099 in the same tax year, depending on the type of work you do.
Gathering your tax information regarding income is critical to your tax return filing, but there is more to being “tax ready.” Please take a look at our year-end checklist for tax season 2020. While all businesses don’t operate the same way, there are some tasks that all companies should go through when preparing for tax season. It begins with making sure your books are clean throughout the year. Performing tasks like monthly reconciliations and reviewing open accounts receivables will ensure that your bookkeeping is always up to date and will provide you with the information you need to assess your business performance.
Expex is based in Schenectady, NY, offering convenient and innovative bookkeeping services to help your business succeed. Our application, Carly, can do everything a traditional bookkeeper does and more. This financial management program expertly fulfills services such as bill payments, bank and credit card reconciliation, and financial records consolidation. Call (518) 389-2305 today to get started, or contact us to learn more about Carly.