You must list out your exemptions and select your filing status before moving on to report your income. This is because each filing status has a different tax bracket for calculating your income.
The good news is your filing status doesn’t affect your exemption amount for yourself and your dependents. Exemptions work like deductions, which mean they reduce your taxable income. Therefore, the more exemptions you have the more your taxable income is reduced, which means the lower your tax liability will be. The top section of the form also includes a section for you to list the name, social security number, and relationship of all of the dependents you are claiming on the form.
Allowable Income on Form 1040A
You can only report specific types of income on this tax form. You are only allowed to include wages, salaries and tips, interest and dividend income, capital gains, IRS, pension and annuity distributions, unemployment compensation, Alaska permanent fund dividends, and social security benefits. Any other type of income, such as self-employment income, must be reported, but you are required to file the full-length form 1040.
Once you have reported all of your income, you will then be able to claim specific adjustments to get to your adjusted gross income (AGI). Some of these deductions include educator expenses, IRA contributions, student loan interest and tuition payments.
Reporting Tax, Credits and Payments on Form 1040A
The second page of this tax form is where you deduct the standard deduction and your exemption allowances from your AGI to get your taxable income. After this, it is time to determine how much you owe in taxes by finding the correct range for your taxable income and filing status using the tax tables in the instructions.
When you have determined your tax, you will then claim limited tax credits that you qualify for. Some of the allowable tax credits include child and dependent care expenses, the credit for the elderly or disabled and education tax credits. These credits reduce your taxes owed by the dollar. Once this is done you then have to lower the number even more by subtracting the tax payments you already made during the year via withholdings from your employer.
When to Use Tax Form 1040A – TurboTax Video
The Difference between Form 1040A and Form 1040
While the filing status and exemption section on the two forms are similar there are differences between these two forms. For example, 1040A is much shorter than the standard 1040 form since you can only report a limited amount of income and make a limited amount of adjustments to your income. The main difference is form 1040A doesn’t allow you to itemize your deductions, but form 1040 does.
Tax season is just around the corner. That means it’s time to start thinking about your tax refund and how much you might be getting back.
The TurboTax TaxCaster is an all-in-one online tax tool that helps you work out a range of tax-related figures.
This free tax refund calculator can be accessed online, and because you can use the calculator anonymously, you can rest assured that your personal information is protected.
Let’s look at TaxCaster 2018 and see how it analyzes your income and key tax factors to determine an income tax refund estimate for 2017 – 2018 that you can use to budget accordingly.
How TurboTax TaxCaster Works
The calculator uses information about the deductions and exemptions that you qualify for, and factors them into a calculation to work out your total taxable income.
This total is then used to work out how much you owe the IRS, or how much you should be refunded, again by working out any potential tax credits and outstanding amounts owed to you.
Determining your Deductions
There are certain payments, transactions, and expenses that will be subtracted from your tax payments. These are called tax deductions: tax deductible payments that mean you can claim a refund back from the Internal Revenue Service (IRS).
Here are several common tax deductions:
Interest on your mortgage
Municipal income taxes (both state and local)
Real estate tax
Certain medical and educational costs.
Here are 10 more tax deductions you may qualify for:
Tracking these deductions throughout the year will help you to work out both your local and state tax liability, but there’s a much easier way. The TurboTaxTaxCaster is programmed to understand your potential deductions, and factors them into your overall tax refund estimate.
Qualifying for Exemptions
Most people do not realize that they could qualify for tax exemptions that can go a long way to reducing their tax bills.
These exemptions are structured on certain tiers, meaning you can qualify for different exemptions. There are personal exemptions, which cover individual costs; dependent exemptions that may apply to costs for your family members, and local city, state, or county exemptions that apply to you based on where you stay or do business.
Qualification for an exemption means that you do not have to pay tax on a certain transaction type or amount, which can go a long way to keeping you in the tax man’s good books. These exemptions are particularly useful if your estimate suggests you are not on track to claim a refund.
Do your research and make sure you keep up to date with the annual changes to tax legislation to not only select, but qualify for, a lucrative tax exemption.
AMT stands for Alternative Minimum Tax, and it forms another filter that will be applied when determining your tax status.
AMT is applied to companies, people, and certain types of investment accounts at a consistent rate that is based on the difference between their taxable income and the exemption threshold.
What makes AMT so complex is that it is calculated per different criteria. In addition to normal tax, it factors in asset depreciation and ongoing medical costs meaning the AMT repayment is not automatically the same as your standard tax figures.
Although it sounds complex, the bottom line is that you will be expected to pay the higher of the two tax rates if your federal tax payment is less than the AMT amount calculated. This means that it is essential to know both numbers so that you know what you’re going to pay.
You Can Use the Tax Caster for Free
Unlike the old days when working out your tax payments involved a trip to the tax man, you can use the TaxCaster calculator anywhere, because it is an online tool. For added convenience, you can also download the app.
For many tax filers, TurboTax is the leading software to get their taxes done quickly and easily without the ridiculous costs of having to pay someone else to file for them, and we can see why. Turbo Tax online software remains ahead of the competition when it comes to customer satisfaction. Last year, they led the way in allowing tax filers like you to file online for free. All you need to do is qualify by being eligible to file a 1040EZ or 1040A for your taxes and their free program, Absolute Zero is available to you.
What You Get with TurboTax Absolute Zero:
With TurboTax Absolute Zero, there is no need to have any experience with tax filing. You don’t have to be an expert, and you don’t need to be a tech geek to use the program. All you do is enter your information into the system, and the program takes care of the rest. It will ask you easy to follow, interview style questions to help you along with the process of filing your taxes and alert you to any potential discrepancies that could trigger an audit.
You Can Get Your W-2 Form Online
Many companies are making their employees W-2s available online. These forms can easily be downloaded, as long as your employer automates their W-2 distribution process. Usually, your employer will notify you that your W-2 forms are available online. By importing your w-2, you will not have to wait for a paper copy to arrive in the mail, which allows you to file your taxes sooner. TurboTax online can help you import your W-2 if your employer has made it available and get your taxes started sooner.
Need to ask an expert for advice? Absolute Zero provides many of the same features that users of the paid version know and love. This includes SmartLook, a program feature that allows users to connect with tax experts who can answer any of your questions concerning your filing as well as review the documentation you’ve entered into the program. They can even show you ways to save money on your filing for next tax season.
With Turbo Tax’s innovative approach to filing taxes this year. We highly encourage the use of this program, regardless of your experience in doing taxes. Whether you are completely new to the world of tax filing, or a well-researched and organized expert, TurboTax makes everything easy – saving you time, money, and helping you avoid unnecessary stress. Using TurboTax’s Absolute Zero, is just as resourceful as the paid version of their product, and best of all: it’s free to use!
TurboTax Currently Offers Four Tax Products.
1. You have the free federal edition, which is for those who file forms 1040EZ and 1040A, which includes state filing for free. This version helps you claim dependent and child credits, but you are not able to itemize your deductions.
2. If you need to itemize your deductions, you will have to go to their deluxe version, which is great for taxpayers who itemize or are homeowners. It is not free to file and you have to pay an additional fee to file your state taxes.
3. The premier edition is the one you would use if you have investment and rental property income to report. However, as with the deluxe version, you will have to pay extra to file your state taxes.
4. Lastly, you have the home and business edition, which is for those who have small business or self-employment income. This is the most expensive option, but it includes everything, excluding the state return, which can be filed for an additional fee.
Turbo Tax is the Best Solution for Solving Your Tax Situation
With Turbo Tax’s innovative approach to filing taxes this year. We highly encourage the use of this program, regardless of your experience in doing taxes. Whether you are completely new to the world of tax filing, or a well-researched and organized expert, TurboTax makes everything easy – saving you time, money, and helping you avoid unnecessary stress. Using Turbo Tax’s Absolute Zero, is just as resourceful as the paid version of their product, and best of all: it’s free to use!
Many users say that TurboTax’s process is “as close to common sense as possible” and that “it felt like it would be a lot easier from the start. The guided interface is super helpful and the life event topics help tax filers understand the deductions and credits that they are eligible for, such as mortgage interest, childcare expenses, and charitable donations.
Are You Wondering When Can You File Taxes in 2018 ?
Update: Currently, the first day the IRS will start accepting electronic tax returns is going to begin on Jan 16, 2018.
The good news is anyone can get started today with early online tax filing and get a head-start on their tax refund. TurboTax and H&R Block will securely hold and then submit customers’ tax return to the IRS as soon as they begin accepting returns. There is no faster way for taxpayers to get their tax refunds!
1. If you file with TurboTax online you can easily prepare and file your own taxes. TurboTax offers advanced tools to help you pay the least amount of tax possible. They also provide extremely fast refunds.
2. If you’re ready to get your taxes filed, join the many tax filers who use H&R Block’s online tax filing. With features online such as the Free Tax Refund Calculator and W-2 Finder, you can’t lose.
How Soon Can I File Taxes?
The first day to file taxes with the IRS will officially start on January 23. However, you can get started at anytime with online tax filing and get your refund as soon as possible.
Four out of five returns have also been projected to be prepared using tax return software and e-filed. However, if you do plan to paper file, you also have the same starting date as those who will be e-filing. Keep in mind, that when you file early in January via paper this is not giving you an advantage over those who are e-filing their returns.
IRS Commissioner John Koskinen said that he was looking forward to opening the 2017, 2018 tax season on time and that IRS employees have worked all year to make it happen. He also revealed that he was appreciative of the nation’s tax professionals and software communities, which are particularly helpful to taxpayers this time of year.
As part of the Security Summit initiative, the IRS has been working closely with tax industry professionals and state revenue departments in an attempt to combat identity theft for taxpayers during this tax season.
Deadline for Filing Taxes
The filing deadline for 2018 will most likely be April 18th.
The IRS website also has a wide variety of tools and information available that can make preparing taxes easier. In addition, it is recommended that you e-file and chose direct deposit as the way to receive your refund. This ensures you keep your information safe, your return is accurate, and that you receive your refund in the fastest amount of time.
Once again, the IRS has projected that nine out of ten returns will receive their refunds in less than 21 days. If you qualify, you should also take advantage of free tax options available. You can go to the IRS.gov to the “filing” tab to see what options may be available to you.
Additional Tax Filing Facts to Keep in Mind
70% of taxpayers are eligible to file their taxes via IRS Free File. Other commercial partners of the IRS offer free brand name software to 100 million individuals and families who make less than $62,000.
Online fillable forms allow you to have electronic versions of IRS paper forms regardless of your income. They can be prepared and filed by you if you are comfortable preparing your own income taxes.
VITA and TCE provide free tax help to those who qualify. You can learn more about them by going to the IRS website and entering “free tax prep” in the search box. Alternatively, you can download the IRS2Go mobile app on your phone and find a free tax prep provider that way.
Tips for Filing Your Taxes
Organize – Make sure that you have everything that you need before you even begin working on your returns.
E-File – E-filing comes with so many benefits such as ease of use, quickness of filing, and identity protection.
Sign Up For Direct Deposit – If you want to receive your tax refund in the quickest amount of time, you need to sign up to have it direct deposited.
Ask Questions if Needed – If you are unsure about something ask questions. It is always better to be safe than sorry.
How to Get a Fast Tax Refund
When 2018 rolls in you can start preparing your tax return online. Once you have it completed, you will be among the first of taxpayers who have their returns processed and their refunds issued.
Keep in mind when you file your taxes with TurboTax or H&R Block the process is easy. They provide you with the largest refund possible by insuring that they ask the correct questions to find out which deductions and credits you qualify for.
You can also use their free tax refund calculators to see how much your tax refund will be. When you file your taxes online there is no way that, you can go wrong and many taxpayers are able to file their federal tax returns free or at a discount.
What to Do if You Have Not Received Your W-2
Before you can file your tax return, you have to have all of the documents needed, including your W-2. All of your employers are responsible for sending you this yet they do have until February 2nd to do so. In the event that you have not received your W-2 yet, you can follow these steps.
Contact Your Employer – If you have not received your W-2 yet, you need to contact your employer to see when they put it in the mail. It is possible that it was returned to them due to incorrect mailing details. Once you have contacted them and found out the status give it a reasonable amount of time for your W-2 to arrive.
Contact The IRS – If you have not received your W-2 after February 14th, it is time to call the IRS at 800-829-1040 for assistance. When calling make sure you have your name, address, social security number and phone number. Additionally, you will need your employer’s name, address, phone number, your employment date, the estimate wages earned from them during the year and estimated federal income tax that was withheld. To make an estimation you should refer to your most recent pay stub.
File Your Return – Even if you do not have your W-2, the IRS expects you to file by April 18, 2017 or request an extension. You can use Form 4852 Substitute for Form w-2, Wage and Tax Statement. This form should be attached to your return, however, keep in mind your refund may be delayed since the IRS has to verify your information.
File Form 1040X – If you receive your W-2 after you have filed your taxes, you must amend your return by filing Form 1040X Amended U.S. Individual Income Tax Return.
To ensure that you receive the maximum refund possible it is suggested that you file your taxes using online software. It makes filing taxes easy and when filing your taxes electronically your tax refund can be returned to you sooner.
Filing Your Taxes Online With TurboTax
Remember, when you file your taxes with TurboTax, you don’t need to know which schedules to fill out. We’ll ask you simple questions about your life and put your answers on all the appropriate forms.
You’ll get step-by-step instructions through your taxes, expert help when you need it and every deduction and credit that applies to you. We make sure you get the biggest refund possible. Try the Free tax refund calculator to see your how much money you’ll be getting back.
Medical expenses can damage your budget tremendously, especially when the emergency is unexpected and your insurance does not cover it. The good news is the IRS does allow you to have some relief from medical expenses with a medical deduction for 2017.
However, to take advantage of their leniency you have to know what is considered a medical expenses and how to claim the deduction.
Deduction Value for Medical Expenses
The IRS allows you to deduct your qualified medical expenses that exceed 10% of your AGI.
For example, let’s say you had an AGI of $45,000 and $5,475 in qualified medical expenses. You would have to multiple $45,000 by 10% to find that only expenses exceeding $4,500 could be deducted, which means your deduction would be $975.
Those who are over the age of 65 can deduct qualified medical expenses that exceed 7.5% of their AGI.
2017 IRS Medical Deductions
Dental and vision care
Psychologists and psychiatrists visits
Prescription medications and appliances
Travel expenses for medical care
Medical Expense Deductions Video
Non-Deductible Medical Expenses
Any medical expenses that you are reimbursed for are considered nondeductible. Additionally, you cannot deduct cosmetic procedures, non-prescription drugs (insulin is excluded) and general health items. You also can only deduct the expenses during the tax year that they occurred.
How to Claim the Medical Expenses Deduction
To claim the medical expenses deduction, you have to itemize your deductions. Additionally, you should only claim this deduction if it is higher than the standard deduction. If you decide to itemize your deductions, you have to file Form 1040 and attach Schedule A.
Report the total amount of medical expenses that you paid on line 1 of Schedule A and your AGI from line 38 on Form 1040 on line 2.
Put 10% of your AGI on line 3
Enter the differences on line 4
The results on line 4 will be subtracted from your AGI to show your taxable income
If this amount is less than your standard deduction, stick with the standard deduction.
Itemizing deductions are ideal for those that are self-employed, have a lot of out-of-pocket medical expenses, and investments. Business owners also itemize deductions for personal business expenses on their individual returns. It is important, however, to view the updated list of accepted deductions and their limitations prior to completing your tax return.
Itemizing deductions is tricky. Some have a floor amount, or minimum amount allowing for deductions over set dollar amounts only.
Another twist with itemizing deductions is limits for taxpayers based upon income amount. This income limit can also change as inflation adjustments are made to standard deductions. This does not mean that your deduction will not count, it may just reduce the amount of the deduction that you can take.
Tips for staying organized for itemized deductions:
Keep separately labeled files for each expense
Date every expense
Keep files in chronological order
Obtain copies of donations, mortgage interest, medical expenses and other miscellaneous expenses
To file your itemized deductions, you will use form 1040 Schedule A. This form must be attached to and/or submitted with your completed form 1040. You cannot itemize deductions if you are using form 1040 A or 1040EZ.
Keep in mind, if you file with TurboTax or H&R Block they will ask you the correct questions to let you know which medical deductions you qualify for and guarantee you will receive the largest refund ever. You can also use their free 2018 tax refund calculator to see how much of a refund you can expect.