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Understanding 1040 Tax Form

Have the 1040 tax form in front of you when trying to understand how the 1040 tax form works. Below is each section of the 1040 tax form.

Tax Year

Your tax is figured on the basis of your income and the expenses you incur during the tax year. A tax year is an annual accounting period used for reporting income and expenses. For most people, the tax year is the calendar year starting on January 1st and ending in December 31st.

Tax Year

Label

Based on the previous tax filing, the IRS often sends out preprinted labels to taxpayers. If you have a label sent by the IRS, then just put the label in the 1040 tax form where it says 'Label Here'. You don't need a label and won't be sent one if you are filing electronically. However due to many circumstances, if a taxpayer does not receive a preprinted label from the IRS, he or she needs to enter his or her (as well as spouse's if applicable):

  • name,
  • address
  • social security number

The names and social security numbers must match the information on each person's file at the Social Security Administration.

 

Social security card

So, if a taxpayer has any name mismatch issue, at least the name and SSN on his or her tax form must match his or her social security card information.



Filing Status

The filing status you enter on your 1040 tax return form is very important. Different tax filing statuses will be discussed later. Your tax filing status usually depends on whether you are married or considered unmarried on the last day of the tax year. The IRS uses the tax filing status to determine (among others):

  • if a taxpayer must file a tax return,
  • amount of his or her standard deduction
  • his or her tax rate
  • his or her eligibility for certain tax deductions or tax credits

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