When individuals purchase a policy through an exchange, they have an option to receive advance payment of the premium tax credit. This tax credit helps cover some of the insurance costs. The advance credit amount, however, must be accounted for when the policy recipient files his or her tax return. If the advance premium amount was too small, the taxpayer will get the extra. However, if too large of an advance premium credit was paid, the taxpayer must make up the difference, either by paying any tax due or by having the amount taken from an expected refund.
Such calculations are made on Form , which only can be filed with Form A or If you received advance payments of the premium tax credit, you must file one of these longer forms instead of the EZ. Even if you did not get the premium credit in advance but got health care through an exchange and want to claim it when you file, you must complete A or Take the case of tax filer Joe P.
A perfect EZ filer, right? Joe has a student loan. Joe also would get the chance to reduce his actual bill if he files the longer A. The better tax news for Joe is that a credit allows you a dollar-for-dollar reduction of what you owe the IRS. But the only tax credit shown on the EZ is the earned income tax credit, available only to low-income taxpayers. And there are even more tax-saving opportunities found on the long Form They might not apply to Joe, but they could cut your tax bill — if you take the time to look over each of the forms.
Here are the basic guidelines for the three individual tax returns. And ever since the IRS doubled the earning limit on filers who use it, the EZ has been available to even more taxpayers. The ease of the one-page EZ is appealing, but it limits the number of ways to save on your tax bill. You also need to look at those other two individual tax returns to take advantage of additional income adjustments and tax credits.
Compare rates at Bankrate. The A form is the next step up the tax-form ladder. As with Form EZ, the earning limit on filers wanting to use the A has increased, so more taxpayers should be able to use it.
Individuals choosing the A can file using any of the five available filing status options: single, married filing jointly or separately, qualifying widow or widower, or head of household. People who file the A also can claim, in addition to the EITC, several tax credits — the child, additional child, education, dependent care, elderly or disabled, and retirement savings credits — that are not available with the EZ.
Form A also gives you the chance to claim several adjustments to income. These items are sometimes referred to as above-the-line deductions, because you claim them just before the bottom line of the form, the one where you enter your adjusted gross income. By reducing your total gross income, your taxable income will be lower and your tax bill should be smaller, too.
Adjustments allowed on Form A include educator expenses, certain IRA contributions, student loan interest, and some college tuition and fees. Finally, choose Form if your earnings are larger, you itemize deductions or you have more complex investments and other income to report. Estimate your tax refund and where you stand Get started. See if you qualify for a third stimulus check and how much you can expect Get started.
Easily calculate your tax rate to make smart financial decisions Get started. Estimate your self-employment tax and eliminate any surprises Get started. Know what dependents credits and deductions you can claim Get started. Know what tax documents you'll need upfront Get started.
Learn what education credits and deductions you qualify for and claim them on your tax return Get started. The above article is intended to provide generalized financial information designed to educate a broad segment of the public; it does not give personalized tax, investment, legal, or other business and professional advice. Skip To Main Content. Here's a guide to all of the variations you may come across. Why are there different versions of the form?
There are now four variations of the form A and EZ no longer exist : Form This is the one the majority of taxpayers will use to report income and determine their tax for the year and any refund or additional tax owed. Form SR: This version is for senior taxpayers age 65 and older. Form SR is nearly identical to Form , but is printed using a larger font and includes a chart for determining the taxpayer's standard deduction.
Form NR: This form is for non-U. Form X: This form is for taxpayers who need to make amendments to their tax return after previously filing a Form What is the purpose of a form? Itemized deductions include expenses such as: mortgage interest, state and local income taxes or sales taxes, charitable contributions, and excess medical expenses. What are the different schedules used with Form ? Even though Form is relatively short, there are various schedules, or additional forms, that help taxpayers calculate specific items that apply to Form Schedule 1: This form is used for reporting several common additional income sources or adjustments to income.
Some common examples of items reported on Schedule 1 include alimony, gains or losses from the sale of a business property, unemployment compensation, educator expenses, tuition and fees deductions, and health savings account contributions.
Schedule 2: This form is used for reporting additional taxes, and it now consists of two parts. The first part is for reporting alternative minimum tax and repayments of excess premium tax credits for health insurance purchased through the health insurance marketplace. The second part is for reporting self-employment taxes, unreported social security and Medicare tax, additional tax on IRAs or other tax-favored accounts, household employment taxes, repayment of first-time home buyer credit, and section net tax liability for foreign corporations.
Schedule 3: This form is for reporting additional credits and payments, and it's split into two parts: refundable credits and non-refundable credits. This link is to make the transition more convenient for you. You should know that we do not endorse or guarantee any products or services you may view on other sites.
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