Didn’t Form 1040 just change as part of the 2018 Tax Cut and Jobs Act?  Now Congress is changing it again for 2019? 

Form 1040 was reported on two pages for decades.  It was then decided to cut those pages into two half pages and six schedules. The initial goal was to simplify the 1040 individual tax return and hope to have taxpayers file on a form the size of a postcard.  It was quickly realized this was not the case for most individuals. 

There were complaints on the layout of the form as there is much wasted paper and the taxpayer is signing the front page that is reporting taxpayer information – no income.  Six schedules accompanied the first page but were only used if applicable.  The idea behind the structure of the form was a building-block approach.

A draft of the 2019 Form 1040 has been released for comments.  It is now going back to two pages with less schedules to attach.  Here are some of the highlights:

  • The signature box goes back to page two. 
  • A space for the spouse’s name has been added to page one if filing Married Filing Separate and a space for a child’s name if a qualifying person but not your dependent when Head of Household or Qualifying Widow is selected.
  • Healthcare coverage checkbox has been removed as this is no longer mandatory for the 2019 tax year.
  • Income reporting, standard deduction, and qualified business deduction all move to page one.
  • Adjusted gross income moved from line 7 in 2018 to line 8b now. 
  • Tax credits have changed back to using separate lines on page two instead of consolidated into one or two like it was in 2018.
  • Third party designee moves back to page two.
  • There is a spot for the original divorce date under alimony as it is not deductible after January 1, 2019.

It has been discussed Form 1040 is being revised to enhance matching features.  For example, in 2018 page two reported a full page of numbers with no signature.  Tax preparers feared that could lead to fraud or other reporting problems.

Remember – the proposed changes are not final.  There are several versions of the draft out there for comment.  Doesn’t it seem like the format is going back to its old ways prior to 2018?

Contact your KTLLP CPA to discuss the upcoming form changes or any other tax questions for the upcoming tax year!