1040 introduction

Welcome Overview of 1040

Agenda
Persons required to file a US return.
Filing Status.
Dependents.
Form 1040 – Line-by-Line in Brief

Who needs to file a 1040
Following persons may need to file a Federal Income tax return if:
Citizen or resident alien or elects to be treated
as a resident alien of US.
Resident of Puerto Rico .
A non-resident alien with income from US sources.

When and where to file a return When a person has a gross income of taxable nature and has taxes withheld he needs to file a tax return. Filing Deadline: For 2010 tax year we need to file the return by 18th April 2011.. An automatic extension for filing the return is available (Oct 15 th ). Form 4868 needs to be filed.

Note: An extension is to file the Tax return and not to pay the taxes. When and where to file a return The return needs to filed at various centers specified by the IRS.

Filing Status

Filing Status
There are 5 types of Filing Status available:
Single
Married Filing Jointly
Married Filing Separately
Head of Household
Qualifying Widow(er) with dependent child

Filing Status
A person can file under this Status if on the last day of the tax year, the Taxpayer is:
Never married (or)
Legally Separated from his/her spouse.
Single

Married Filing Jointly Filing Status
The taxpayer can choose to file MFJ if at the end of the year
he/she is married
both agree to file a joint return.
Note: If spouse dies during the tax year, the couple are still considered married for the whole year and can file as MFJ.

Filing Status Married Filing Separately
The taxpayers can choose to file separately though they are married.

Filing Status Head of Household
The taxpayer can choose this filing status if he/she meets the following requirements:
Unmarried or considered unmarried on the last day of the tax year.
Paid more than half of the cost of keeping up a home for the year.
Spouse did not live in the taxpayer’s home during last six months of tax year.
A qualified person lived with the taxpayer for more than half the year.

Filing Status Qualifying Widow(er).
The taxpayer is entitled to file a joint return with the spouse for the year in which the spouse died.
The taxpayer can claim this status for 2 tax years after spouse dies and if he did not remarry in that time.
The taxpayer should have a child for whom he can claim exemption.
The taxpayer has paid more than half the cost of keeping up a home.

Dependents

Dependents
A Person Can be claimed as a “Dependent” if he meets following 5 tests:
Joint Return Test
Relationship Test
Citizenship Test
Gross Income Test
Support Test

Dependents Benefits of Claiming Dependents Taxpayer is eligible to claim maximum personal exemption of $3,650 each for 2010 as a deduction from the Taxable Income. Certain credits are available with respect to the Dependents.

FORM 1040

FORM 1040 Income (-) Adjustments to Income = Adjusted Gross Income (AGI) (-) Deductions = Taxable Income Multiplied by Tax rate equals Tax Liability

FORM 1040 The form is divided into following parts: 1.Personal Information 2.Income Section 3 Adjusted Gross Income 4.Taxes and Credits 5.Other Taxes 6.Payments 7.Signatures.

FORM 1040

Any Questions???

Thank you !

1040 introduction

by knowinfonow on Oct 21, 2011

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1040 introduction — Presentation Transcript