How to File a Federal Income Tax Return

Instructor: Yuanxin (Amy) Yang Alcocer

Amy has a master's degree in secondary education and has taught math at a public charter high school.

At the end of each year, all of us who work in the United States have to file a federal income tax return. Read this lesson to learn what you need to do to file a federal income tax return.

Choose Your Filing Status

In this lesson, we talk about filing your federal income tax return. Your federal income tax return is a document that you fill out that shows your financial activities for the year and calculates the amount of tax you owe or the amount you get refunded if you overpaid during the year. The first thing you need to do is choose your filing status from one of the five options available to you.

1. Single. Choose this if you are not divorced, legally separated, or not married.

2. Married Filing Jointly. Choose this if you are married and want to file just one tax return for the both of you.

3. Married Filing Separately. Choose this if you are married but want to file separate tax returns.

4. Head of Household. This status is for those who are not married but have a dependent.

5. Qualifying Widow(er) with Dependent Child. This status is for those whose spouse died recently, have a dependent child, and meet certain other requirements.

Let's follow Clara along as she fills out her federal income tax return for the calendar year 2015. Clara is single and has one job as a waiter at the local steakhouse. Last year, Clara earned $33,000 from her job in wages and tips combined. Because she is single, she chooses the Single filing status. She doesn't choose the Head of Household filing status because she lives by herself and doesn't provide for anyone else.

As we watch Clara fill out her tax return, do note that the tax return form may change with each passing year. The instructions associated with the form will tell you exactly what you need to do.

Choosing Your Form

Once you have chosen your filing status, you now need to choose which form to use. The federal government gives you three different forms you can use depending on how complicated your return is.

1. Form 1040. This is the form that can be used for all filing situations. Use this form if you are self-employed, want to itemize deductions, have income from a sold property, or your income is over $100,000. This form covers all possible situations.

2. Form 1040EZ. Say EZ. What does that sound like? Easy, right? Well, this form is an easier and simpler form of the 1040. However, you can only use this form if your income is less than $100,000, and you are filing either Single or Married Filing Jointly. You and your spouse, if you have one, must both be under age 65 and not blind. You cannot have any dependents. The only tax credit you can claim in this form is the earned income credit. Your interest income cannot exceed $1,500.

3. Form 1040A. Use this form if your income is below $100,000, but you have capital gain distributions, and you qualify for and want to claim certain tax credits. This form also allows you to claim income adjustments for IRA contributions and student loan interest.

Clara chooses Form 1040 as she wants to make sure that she claims as many tax credits and deductions as possible.

If you use a tax preparation program, the program will automatically choose the correct form for you. The program will also automatically prepare and fill in the forms for you.

These forms are available for download through the IRS website as fillable PDFs that you can either print out and fill in with a pen or fill out on your computer and then print out to sign.

Filling Out a 1040

Clara downloads her Form 1040 from the federal government's IRS website. She is going to fill it in using her computer before printing, signing, and mailing it off. She fills in the first section that asks for her basic information such as her name, address, and social security number.

federal income tax return

She only fills in the boxes that apply to her. Because she is single, Clara only fills in her name and her Social Security number. She doesn't have a spouse, so she doesn't fill in that information.

Next, she fills in her Filing Status.

federal income tax return

She checks Single since she is filing with that status.

Clara moves on to the next section, Exemptions. She checks the box for herself and leaves everything else empty. In line 6d, she adds up her exemptions. She writes 1 for her total.

federal income tax return

The next section is the Income section. She only needs to fill in those lines that apply to her from lines 7 to 21. Only line 7 applies to her as she received a W-2 that shows her income from Wages, salaries, tips. She writes 33000 in line 7. The next line that she needs to fill in for this section is line 22 where she adds all her income from lines 7 to 21. She puts 33000 in line 22 since that is all her income.

federal income tax return

The next section after the Income section is the Adjusted Gross Income. She writes in values for the lines that apply to her and leaves the others blank. She adds up her lines in this section on line 36. None apply, so her total for 36 is 0. She subtracts this line from line 22 and writes the result in line 37 - 33000. This is Clara's adjusted gross income.

federal income tax return

The next section is the Tax and Credits section. Clara starts by copying her amount from line 37 to line 38. Clara is not going to itemize her deductions, so she chooses the standard deduction of $6,300 for her filing status. Clara doesn't itemize her deductions because it doesn't give her a higher deduction than the standard deduction gives her. She writes 6300 in line 40. In line 41, she subtracts line 40 from line 38. She gets 33000 - 6300 = 26700. For line 42, because Clara's adjusted gross income is less than $154,950, she multiplies $4,000 by the number of Exemptions she has from line 6d. She has 1, so she writes $4,000 * 1 = 4000 in line 42. For line 43, she subtracts line 42 from line 41. She gets 26700 - 4000 = 22700. For line 44, Clara uses the tax table that comes with the instructions for the Form 1040. She uses the amount listed in line 43 (22700) to find her tax from the tax table. She finds her tax to be $2948, which she writes down for this line. Lines 45 and 46 don't apply to Clara, so she doesn't write anything here. At line 47, she adds her amounts for lines 44, 45, and 46. She gets 2948. Her lines 48 through 54 are blank because they don't apply to her either. Then in line 55, she sums up her values from lines 48 through 54. She gets 0. Then for line 56, she subtracts line 55 from line 47. She gets 2948. If she got a negative number, Clara would then put 0 for line 56.

federal income tax return

Clara now moves on to the section Other Taxes. She doesn't have any of the situations mentioned in lines 57 through 62. In line 63, she adds lines 56 through 62. She gets 2948.

federal income tax return

In the next Payments section, Clara writes down the federal taxes that were withheld from her paychecks. These withheld amounts count towards Clara's tax payments. Her W-2 shows that she had federal income taxes withheld in an amount of $3,213. She writes this amount in line 64. Because Clara is single and earns more than $14,820, she doesn't qualify for the Earned Income Credit, so she writes in 0 for line 66a. None of the other lines fit Clara's situation, so she moves on to line 63 where she adds her amounts from lines 56 through 62. She gets 3213. This is her total tax payments. You might have noticed that her total tax payments are more than her total tax.

federal income tax return

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