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The three types of federal tax return forms in the USA, from shortest to longest, are: 1040EZ, the "easy" version 1040a, the "short form" 1040, the "long form" Form 1040EZ, while the shortest and simplest, can only be used under certain very specific conditions. To use this form, you must satisfy the following criteria A total annual income of under $100,000, and an interest income under $1500 Your filing status must be either single or married filing jointly If married and filing jointly, both you and your spouse should be less than 65 years in age Sources of income limited to wages, unemployment benefits, interest and dividends from Alaska Permanent Fund. You do not have or claim adjustments to income Not having any deductions other than the standard deduction Claiming Earned Income Credit Claiming no other tax credit Clearly, this list puts most people out of contention for the Form 1040EZ. If you are among this number, consider yourself lucky. The tax return form that is next in ease of use to 1040EZ is the form 1040A. The 1040A allows taxpayers of greater variety in age, filing status and income adjustments to file a tax return. People who can use the form 1040A must fulfill the following criteria Total annual income must be less than $100,000 Filing status or age any Heads of income Interest Wages Dividends IRA or pension Unemployment benefits Capital gain distributions Social Security benefits Adjustments to income must fall within the following list Penalty incurred due to premature withdrawal from savings Interest on student loan Contributions to IRA Jury Duty pay Tax credits that can be claimed within form 1040A must be for: Child and dependent care Education Being elderly and disabled Child tax EIC Contribution toward retirement savings Standard deduction only If you find that even form 1040A is inadequate for you, or if you are not sure, use the form 1040. The long form becomes mandatory if: Your income exceeds $100,000 You choose itemized deductions Your income is from business, agriculture, rentals, partnership, S-corporation, trust etc You claim tax treaty benefits You have a foreign income or have paid foreign taxes You claim income adjustments for education, moving or health investments. Other than these forms that specify the format for your tax return, you may also need 1. Form 709. This is used to file Gift Tax returns, which are necessary if you give any individual $12000 or more in the financial year 2. TD F 90-22.1, Report of Foreign Bank and Financial Accounts. This report is required to document any reserves great than $10,000 that you may have in foreign financial institutions. This report should be filed by June 30, and is submitted to the US Treasury Department. The golden rule while choosing tax forms is if you are not sure if a certain detail is eligible under your form, go with form 1040. It may look tough, but it is the safest option.
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