Millions of taxpayers file Form 1040A every year. If you’re filing a paper return, use the simplest form you can. Using the simplest form possible reduces the chance of an error that could cost you money or delay the processing of your return.
To use Form 1040A, your taxable income must be less than $100,000, and you must only have income from the following sources:
Wages, salaries, and tips
Interest and ordinary dividends
Capital gain distributions
Taxable scholarship and fellowship grants
Pensions, annuities, and IRAs
Unemployment compensation
Taxable Social Security and railroad retirement benefits
Alaska Permanent Fund dividends
In addition, the only adjustments to income that you can claim are:
And the only tax credits that you can claim are:
Retirement savings contributions credit
Making work pay credit
You can also use Form 1040A if you receive advance earned income credit payments, dependent care benefits, or if you owe tax from the recapture of an education credit or the alternative minimum tax.
Before you decide to use this form, though, there are some restrictions associated with its use that you should know about. For example, you can’t file this form if you itemize deductions. This means that you can’t deduct charitable donations or mortgage interest paid.
You also can’t file this form if you have an alternative minimum tax adjustment on stock you acquired from the exercise of an incentive stock option.
Don’t decide to use this form simply to avoid completing the long form (Form 1040). You should take advantage of all the tax breaks you’re entitled to. The H&R Block software will determine the right form for you to use and complete it for you.