Your mailbox will be inundated with tax documents as the tax season progresses. New timetables have been introduced often in recent years; many of them have recognized names and numbers.
They all serve different functions and provide information that is essential for filing your taxes. The most crucial tax documents for 2018 are provided below, along with guidance on filling them out correctly. Check out the full version of our tax filing guide for more information.
Form 1040
Many other tax forms and schedules refer to this one, thus it’s fair to call it the grandfather of tax forms. For instance, if your W-2 has a certain amount in Box 1, you must include that sum on Line 1 of your tax return.
When filing taxes, most people use the calendar year as their tax reporting period, and Form 1040 provides a summary of their earnings, adjustments, deductions, taxes, and credits for that time period. Form 1040 requires the submission of all necessary attachments and schedules.
For the 2018 tax year, Form 1040 has been revised to be the postcard-size tax return. Afterward, a 2019 redesign was implemented. Even though the new 1040 isn’t postcard-sized, it’s noticeably more compact than its predecessor. Is it easier though?
Actually, no. There wasn’t much improvement in the ease of filing taxes due to the redesign; rather, it essentially shifted the majority of the data previously found on Form 1040 to six new numbered schedules.
There has been yet another modification that may affect those who file relatively straightforward tax returns. For tax years beginning in 2018, both Form 1040A and Form 1040EZ, simplified forms of Form 1040 for those who don’t qualify for many deductions, are no longer available.
The new and improved Form 1040 is what most filers will use this year. Starting with the 2019 tax year, seniors can use the new Form 1040-SR. Only taxpayers who are 65 or older should fill out this form.
It’s largely the same as Form1040, but it uses a larger font and contains a chart to help the taxpayer determine their standard deduction. Consult our comprehensive Form 1040 guide for additional details.
Form 1040X
If you already submitted your tax return but need to make changes, you can use Form 1040X.
Form W-2
Form W-2 is used by companies to record the wages and salaries of their employees, as well as the federal, state, social security, and medicare taxes that were withheld on the employee’s behalf throughout the year.
The employee, the SSA, the IRS, and their respective state, city, or local tax agencies all receive a copy of this form.
Box 12 of the W-2 is where other commonly reported information appears, such as the employee’s Health Savings Account (HSA) contributions, the amount the employer paid for the employee’s health insurance, and the employee’s voluntary retirement plan contributions.
The dependent care benefits offered by an employer are recorded in Box 10. Field 13 typically has a checkmark in the “Retirement Plan” box. See our comprehensive Form W-2 guide for additional information.
Form W-2G
When you win more than the specified sum at bingo, slot machines, keno, poker, lotteries, sweepstakes, or races, you must fill out this form. Include this sum in your taxable income on Line 22 of Schedule 1 when filing Form 1040.
Form W-4
An individual’s withholding allowance certificate. When you start a new job, you’ll need to fill out a W-4 to tell your employer how much income tax to take from each paycheck.
This amount is determined by your filing status and the number of qualifying dependents you declare. If your personal circumstances change in the future, such as when you get married or have a child, you can submit a new W-4 form to adjust the amount of tax taken from your paycheck.
By submitting your return, you settle any discrepancies between your actual tax liability and the amount of tax that was withheld from your paychecks in advance. It’s preferable for tax payments and tax withholdings to balance out. See our comprehensive Form W-4 guide for further information.
Form 1099
The purpose of each of the several 1099 forms is indicated by the letter or letters at the form’s end. Income from a wide variety of sources is often detailed in these documents. The most typical examples are provided below.
Form 1099-B
Stock and bond trades made through a brokerage account will be reported on Form 1099-B. Schedule D is used to report the gain or loss from these transactions, and the net gain or loss is reported on Line 7 of Schedule B of Form 1040.
Form 1099-C
Cancellation of debt is recorded on Form 1099-C, which may need to be included in your taxable income.
Forgiveness can occur when a home loan is restructured or foreclosed upon, or when a credit card or other loan obligation is settled for less than the full amount outstanding. Line 22 of Schedule 1 is where you’ll need to declare the taxable share of this income.
Form 1099-DIV
Form 1099-DIV is used to record dividends, typically from a brokerage account but also from directly owned shares. Form 1040, Line 3a (total dividends) and Line 3b (other income) should be updated with the information included on Schedule B. (qualified dividends).
Since capital gains rates are lower than regular income rates, such as those applied to wages, qualified dividends are reported on a separate line on the tax return.
Form 1099-INT
Interest from financial institutions like banks, credit unions, and brokerage accounts must be reported on Form 1099-INT. Line 2a (taxable interest) or Line 2b (nontaxable interest) of Form 1040 can be used to report the total amount of interest earned throughout the year (tax-exempt interest).
Form 1099-G
Form 1099-G reports certain government payments, such as a state tax return or unemployment benefits. Lines 1 and 7 of Schedule 1 are where you should enter these figures.
Form 1099-MISC
Miscellaneous revenue is reported on Form 1099-MISC. This includes rent and royalty income, prize and award money, medical and health care payments, crop insurance earnings, attorney fees, and more.
Payments for rent and royalties are reported on Schedule E, and the net amount is included on Line 5 of Schedule 1.
Form 1099-NEC
The newest addition to the 1099 series is Form 1099-NEC. Non-employee compensation was recorded in Box 7 of Form 1099-MISC sent to freelancers and independent contractors prior to 2020.
Form 1099-NEC is now used to report such payments. Box 1 contains the total of all your freelance, gig, independent contractor, and self-employed earnings for the year. Box 4 contains the amount of federal income tax that was withheld from your paycheck by your employer.
Form 1099-R
Pension, annuity, and IRA distributions are all reported on Form 1099-R. The amounts below are identical to what you’d put on Lines 4a, 4b, 5a, and 5b on Form 1040. Total distributions are reported on lines 4a and 5a, while taxable amounts are reported on lines 4b and 5b.
Rollovers, eligible distributions from a Roth IRA, qualified charity distributions, and donations made with post-tax cash can all affect how much of a distribution is taxed.
Form 1099-Q
Qualified tuition programs include 529 plans and Coverdell Education Savings Accounts, and the distributions from these accounts are reported on Form 1099-Q. There is no requirement to include the amount distributed from these accounts on your tax return if you utilized the money to pay for eligible education expenditures.
Keep detailed records of the money’s whereabouts in case the IRS decides to audit your return. Use Form 1099-Q to determine the taxable amount and any penalty that applies, and then enter that amount and the penalty amount into Form 5329 if the distribution is taxable in whole or in part.
Form 1099-S
Proceeds from the sale or exchange of real property are reported on Form 1099-S. The potential for capital gains exists here as well. It all comes down to the specifics of the sale when determining whether or not the gain is taxed.
1099-SA
All distributions from HSAs, Archer MSAs, and Medicare Advantage MSAs must be reported on Form 1099-SA (MA MSAs).
The whole amount of your HSA distribution must be reported on Form 8889, and any tax due must be included on Schedule 1, Line 8. Form 8853 is used to report distributions received from an Archer MSA or a Massachusetts MSA. Line 8 of Schedule 1 is where you should report the taxable part.
SSA-1099
In order to disclose Social Security income, recipients must fill out Form SSA-1099. Line 6a of Form 1040 displays the total amount, whereas Line 6b displays the amount that is subject to taxation. The gross amount of Social Security payments can be found on Line 6a, and the taxable portion can be found on Line 6b.
Form 1098
Form 1040’s Schedule 1 (Adjustments to Income) and Schedule A (Deductions) aren’t the only relevant documents in this category (itemized deductions). The most typical examples are listed here. Read on for additional info with our comprehensive Form 1098 guide.
Form 1098
Mortgage interest, points, and mortgage insurance premiums paid throughout the tax year are all itemized on Form 1098, Mortgage Interest Statement, which is submitted to the IRS by the taxpayer. Mortgage interest and property taxes paid may be shown on your 1098.
Although it may not be explicitly stated on Form 1098, such information is often provided in the accompanying transaction description.
If you itemize deductions, the amounts from Form 1098 should be reported on Schedule A. Line 5b of Schedule A should be used for real estate taxes, whereas Line 8a should be used for mortgage interest and points.
As of this writing, mortgage insurance premiums cannot be deducted from taxable income. In 2017, the mortgage insurance premium tax deduction was no longer available. The mortgage insurance premiums that your lender reports on Form 1098 are not deductible by you.
Form 1098-E
The interest a recipient paid on their student loans during the year can be found on Form 1098-E, Statement of Interest Paid on Loans for Education. A 1098-E form may be issued by each lender from which the student has borrowed money.
Student loan interest paid is an above-the-line deduction reported on Schedule 1, which decreases adjusted gross income up to a maximum of $2,500 per return.
Bear in mind that the person legally liable for the student loan debt may take the student loan interest deduction, not necessarily the one who pays for it.
If a student’s generous uncle is helping them out by making payments on their student loan, but the student is the one who should be paying it back, then the student should be the one to claim the tax deduction, not the uncle.
Form 1098-T
Tuition expenses are reported on IRS Form 1098-T. It keeps track of whether or not the student is enrolled in school at least half-time, whether or not they have completed their undergraduate degree, and whether or not they are pursuing a graduate degree.
The American Opportunity Tax Credit and the Lifetime Learning Tax Credit can only be claimed using this form.
Forms 1095-A, B, and C
These three documents are associated with medical insurance. If you obtained health coverage via the Health Insurance Marketplace, you will receive Form 1095-A. Those who were covered in the home and for how long are listed.
It also shows if the taxpayer is eligible for the premium tax credit and whether or not they have pre-paid any of their health insurance premiums.
Even if you would not normally be required to file taxes, if you received a Form 1095-A and the advance premium tax credit was paid, you must file a return to reconcile the advance credit you received.
Form 8962 is used for the reconciliation, which could lead to you having to pay back some of the credit (on Line 2 of Schedule 2) or receiving more credit than originally expected (Line 8 of Schedule 3).
Your health insurance carrier should have sent you a Form 1095-B detailing your family’s coverage status and length of coverage for the last year.
If your company has provided health insurance in the past, you likely received Form 1095-C from them detailing the number of people in your household who were eligible for and received coverage during that year.
Due to the elimination of the tax penalty for going without health insurance coverage as of January 1, 2019, by the Tax Cuts and Jobs Act of 2017, Form 1095-C will no longer be issued in 2019. Because of this, you can disregard the requirement to show the IRS that you obtained insurance.
Bottom Line
You may be worried or unsure about how to finish the deluge of tax forms you will get and need to complete this year. H&R Block’s online tax software will guide you through the necessary questions and data entry to file your taxes.
Spend some time at the outset organizing the paperwork you’ll be filling out by what it pertains to (income, adjustments, deductions, credits, etc.).
You can get the upper hand at tax time if you prepare and organize ahead of time to handle the paperwork. You may also check out our comprehensive tax filing guide for more information.
