One of three individual tax forms, 1040EZ is the simplest, but must be properly filed. Tax expert Frank Ellis now provides a detailed guide on how to fill it out in 2018.
In a new Nationaltaxreports.com article, tax preparation planner Frank Ellis explains what is IRS Form 1040EZ for filing taxes in 2018. He explains it is the quickest and easiest of three main forms to fill out. The form is used by taxpayers who do not have to itemize deductions or have dependents.
After comparing it to 1040A, a longer, more involved form, Ellis explains the limits for 1040EZ related to health care. The author says the form cannot be used once someone purchases a health insurance plan from the federal marketplace. Premium tax credits for helping people pay for their insurance plan are explained, along with how this applies when filing taxes. Ellis also states what happens if the advance is not enough or if taxpayers still have a balance to pay. IRS Form 8962 should be filed with 1040/1040A to see whether advanced funds were distributed correctly.
The article also explains how filing a 1040EZ form can cost a taxpayer money. This is especially so if one doesn’t claim credits and deductions they apply for. Ellis also says the form doesn’t allow student loan interest to be deducted, or have space to claim an Individual Retirement Account to reduce taxable income.
Frank Ellis does, however, explain how filing other forms can put one into a lower tax bracket. Standard deductions and personal exemptions further reduce taxable income. Other forms also support education credits and Ellis talks about how one credit, the Lifetime Learning credit, can work for a taxpayer.
For more detailed information about the advantages of filing IRS Form 1040EZ over other forms, and when different tax forms should be used, go to http://nationaltaxreports.com/2017-irs-1040ez-tax-return-form-guide/.