1040 Format Change for 2018

[scrabbler1]

Schedule 5 Line 66, which flows to Form 1040 Line 17.

The ACA tax subsidy is also found on Schedule 5, line 70, after you complete the usual Form 8962.

So, let's see what I will have to fill out:

1040
Schedule 1
Schedule 5
Schedule B
Schedule D
8949
8962

I do lose Schedule A because I won't be itemizing, but I add 2 other pages instead. Six pages barely fit into an envelope. Will 7?

 

[COcheesehead]

I’m going to let TurboTax fill this out for me.

Hehe, me too. I am not sure when the last time was I even looked at the form.

 

[Jerry1]

I’m going to let TurboTax fill this out for me.

Hehe, me too. I am not sure when the last time was I even looked at the form.

Exactly. This is their problem. As a CPA who only did taxes for a couple years (i.e. not an expert), I use TT and then I go over it and make sure it makes sense to me. Thankfully, I do understand how my taxes are calculated as my situation is not that complicated.

 

[Souschef]

I volunteer with the AARP/IRS low income/senior tax program. Classes will be fun this year

 

[Walt34]

I’m going to let TurboTax fill this out for me.

Same here, and most of the time I don't put much effort into finding a lowest price either. Before home computers I did the returns by hand and to me TurboTax was a godsend when it came out.

And I tend to buy it in January so I can start on the return and then send it in when the last 1099 comes in and it normally doesn't go on sale until March or so.

 

[COcheesehead]

TurboTax is free to certain levels of clients at Fidelity. The free offer link comes out around mid - late December each year. I think it’s offered free to active traders and high balance accounts.

 

[imoldernu]

You’re bragging or is it gloating.

About being too poor to pay taxes?

Consider a trade?

 

[easysurfer]

I’m going to let TurboTax fill this out for me.

Same here.

I'm going to make TurboTax do the heavy lifting .

 

[gauss]

But, if you meet all of the requirements for a simple form it will fit on a postcard! I'm pretty sure that's the only reason the IRS is "simplifying" the tax forms.

Half a 8 1/2 x 11 inch letter page "postcard" that is -- and two sided.
Plus the additional 6 or so new schedules.

I always thought 1040-EZ/A were for folks who didn't need/want a full tax return. Seems like they are solving a problem that didn't exist.

-gauss

 

[gauss]

I volunteer with the AARP/IRS low income/senior tax program. Classes will be fun this year

I think most tax law changes will be out of scope for these programs and not too difficult to handle. I, for one, look forward to the end of having to correctly calculate "taxable refunds" and all that entails as well as ACA exemptions in 2020.

The Tax Slayer transition, however, left many scars.

-gauss

 

[scrabbler1]

Half a 8 1/2 x 11 inch letter page "postcard" that is -- and two sided.
Plus the additional 6 or so new schedules.

I always thought 1040-EZ/A were for folks who didn't need/want a full tax return. Seems like they are solving a problem that didn't exist.

-gauss

When the tax changes mainly the increase in the SD, went into effect, I thought that the chance of being able to use 1040A rose a lot.

Since I retired 10 years ago, it took 2 things to happen in order for me to able to switch to 1040A from 1040: I needed to use the SD instead of itemizing, and I needed to not make any redemptions in my mutual funds. The former would trigger Schedule A while the latter would trigger Form 8949 and Schedule D. I could still include any cap gain distributions on 1040A without using Schedule D.

I was lucky enough for these two things to happen in the same year once, in 2013. Most of the time, I was itemizing so that forced me to use Schedule A and Form 1040. Most years, I didn’t make any redemptions in my mutual funds. So, reducing the chance of itemizing to nearly zero would likely allow me to switch to 1040A.

But with these goofy tax form changes, 1040A is gone, so my tax forms will not get any easier because of all the silly copying of cap gains income from one form to another before landing on the “postcard.”

 

[kaneohe]

I volunteer with the AARP/IRS low income/senior tax program. Classes will be fun this year

Not sure about that......Taxwise used to be form based. Taxslayer to me was less so although not quite like an interview. Seems to me that the input pages could be similar to the old pages and then , as others have said, let the software put it in the appropriate place. We shall see......

 

[imoldernu]

Understanding standard deductions

I confess to not knowing or caring about income tax. Doesn't much affect me, but sometimes stuff pops up that causes some curiosity.

Was the decision to itemize your deductions last year a relatively close call?
If so, you’re part of the population for whom this guide most directly applies. Under the new tax law, the standard deduction will rise from $6,350 for the 2017 tax year to $12,000 in 2018 for individuals, and $12,700 to $24,000 for couples. If you were right on the edge taking the $6,300 deduction in 2016, this might mean you will stop itemizing your taxes moving forward—but not this year.

https://qz.com/1167603/the-most-important-things-you-should-do-before-2018-to-take-advantage-of-the-us-tax-reform/

Simple answer?

 

[gauss]

Yes - the standard deduction for 2018 will be approximately double of what it was in 2017.

Remember, however, that the now obsolete personal exemptions (ie ~ 4000/each for husband and wife) have been eliminated so that the "doubling" is more of a rolling the personal exemptions into the standard deduction.

This will result in most folks no longer being able to get a tax benefit for Schedule A deductions (ie mortgage interest, property taxes, charitable deductions, medical expenses etc. etc).

Beware that the recommendations to "take now", in the linked article, were to be done before the end of 2017 and are now obsolete.

-gauss

 

[COcheesehead]

Yes - the standard deduction for 2018 will be approximately double of what it was in 2017.

Remember, however, that the now obsolete personal exemptions (ie ~ 4000/each for husband and wife) have been eliminated so that the "doubling" is more of a rolling the personal exemptions into the standard deduction.

This will result in most folks no longer being able to get a tax benefit for Schedule A deductions (ie mortgage interest, property taxes, charitable deductions, medical expenses etc. etc).

Beware that the recommendations to "take now", in the linked article, were to be done before the end of 2017 and are now obsolete.

-gauss

Yes for me personally this was a big change with the new tax law. I could no longer deduct interest and taxes. It changed how I plan to pay for our new house, how we plan to donate. It changed the paradigm that I had been so used to for years. I also prepaid my 2017 property tax so I could get some benefit from it last year.

 

[Souschef]

2017 will be the last year I itemize. We bought 2 cars, so the sales tax and registration was a big factor. But that was a one time deal.
I have shifted most of my charitable giving to QCD's instead.

 

[Lawrencewendall]

I have a K-1 in my taxable account so hopefully they’ll have it all figured out by the time I’m ready to file.

 

[imoldernu]

So, one more, from here....

https://www.thebalance.com/tax-breaks-for-seniors-and-retirees-4148392

If the total of all your other income and half your Social Security is less than $25,000 and you’re single, head of household, or a qualifying widow or widower, you don’t have to include any of your Social Security as taxable income. If you’re married and filing a joint return, the limit goes up to $32,000.

and this:

The standard deduction amounts will increase to $12,000 for individuals, $18,000 for heads of household, and $24,000 for married couples filing jointly and surviving spouses. For 2018, the additional standard deduction amount for the aged or the blind is $1,300.

 

[kgtest]

Hopefully nobody in America has more than four dependents. Or perhaps the IRS only cares out four of them?

 

[ERD50]

Hopefully nobody in America has more than four dependents. Or perhaps the IRS only cares out four of them?

What are you talking about? -ERD50

 

[gauss]

2017 will be the last year I itemize. We bought 2 cars, so the sales tax and registration was a big factor. But that was a one time deal.
I have shifted most of my charitable giving to QCD's instead.

I use to think that too.

I learned this year, however, that room and board payed to a nursing home or home for the aged or similar facility is deductible as a medical expense.

This will make a big difference in my DM and DMIL's tax returns this year.

-gauss

 

[gauss]

Yes for me personally this was a big change with the new tax law. I could no longer deduct interest and taxes. It changed how I plan to pay for our new house, how we plan to donate. It changed the paradigm that I had been so used to for years. I also prepaid my 2017 property tax so I could get some benefit from it last year.

I paid about 10 years worth of contributions, in advance, to my Donor Advised Fund (DAF) at Fidelity Charitable in 2017. I also make an offsetting Roth conversion for a similar amount.

 

[COcheesehead]

I paid about 10 years worth of contributions, in advance, to my Donor Advised Fund (DAF) at Fidelity Charitable in 2017. I also make an offsetting Roth conversion for a similar amount.

I loaded up my Fidelity Charitable as well. Not sure how the future will go for donations. Just give from the heart and expect no benefit is probably what will happen.

 

[SecondCor521]

What are you talking about? -ERD50

I'm not the person that posted the original cryptic comment, but I believe they are referring to the new draft Form 1040 on the IRS site. IIRC it only has room on the form for four dependents.

That being said, I think the existing Form 1040 we're all used to also only has room for four dependents. In both cases, I believe if one has more than four dependents, one just attaches an additional sheet with the information.

 

[ERD50]

I'm not the person that posted the original cryptic comment, but I believe they are referring to the new draft Form 1040 on the IRS site. IIRC it only has room on the form for four dependents.

That being said, I think the existing Form 1040 we're all used to also only has room for four dependents. In both cases, I believe if one has more than four dependents, one just attaches an additional sheet with the information.

OK, thanks.

I wasn't sure what kgtest was saying. I had not heard that dependents were limited to four (I no longer have dependents, so I might have missed that). Or if it was some sort of judgemental statement about someone (that would be Congress, not the IRS?) 'not caring' for people with more than four dependents?

But I guess you are right, though as you say, that's not a change from last year anyhow, so I'm still

-ERD50