New Federal Income Tax Forms

By Shaun Cote August 5, 2018

The IRS has released drafts of its new and revamped “postcard-sized” 2018 Form 1040, US Individual Income Tax Return. As a comparison, the 2017 Form 1040 is two pages and includes more than 80 lines. (Forms 1040-A and 1040-EZ were shorter, but those too are being replaced with the new Form 1040.) The numerical components of the form can be broken down into 6 sections – income, adjustments to income, tax and credits, others taxes, payments, refund/amount you owe. There are also 6 informational areas – name, filing status, dependents, signature and paid preparer/third party designee. For a great number of filers, most lines were left blank because they were not applicable, leaving most filers wondering what the purpose of all those lines were for.

In comes the IRS 2018 “postcard-sized” form 1040. Drafts of the Form show the new Form 1040 will be two half sized pages. Page one will be partly informational, capturing the taxpayer’s name, dependents’ names and signature. Page two will include the most commonly used lines from the previous version, including lines for income, deductions, payments, credits and refund/amount due. Included on page two are multiple lines to capture amounts from one of the five new schedules that now may be required to be included with a taxpayer’s form 1040.

Drafts of these forms and schedules may be found here:

• Form 1040
• Schedule 1 – Additional income and adjustments
• Schedule 2 – Tax reconciliation schedule
• Schedule 3 – Nonrefundable credit schedule
• Schedule 4 – Other taxes
• Schedule 5 – Payments and credits
• Schedule 6 – Third party designee

Yes, the 2017 Form 1040 was hard to follow and contained well over 80 lines for a typical filer to negotiate when preparing an individual income tax return. The 2018 Form 1040 will now require a taxpayer to negotiate 2 pages of the Form 1040 plus 5 schedules. That isn’t counting all the various supporting forms and schedules still required that haven’t changed from 2017 to 2018.

The new form changes are akin to rearranging the deck chairs on the Titanic. As the saying implies, no matter how you arrange the deck chairs on the Titanic, it was going to sink. The 2018 Form 1040 on the face of it is simpler, but in reality, the only change from 2017 to 2018 was taking over those 80 lines and spreading them over 7 pages.

If you have any questions regarding the new forms, please contact Shaun Cote or your BNN tax advisor at 800.244.7444.