In tax year 2018, forms 1040-EZ and 1040A were discontinued. In order to streamline the tax filing process, the IRS overhauled the 1040 form and most filers moved to use it.
For seniors who file paper forms, it’s helpful to know that for tax year 2019, you can use a new form, 1040-SR for seniors over the age of 65.
Below are the pros and cons to the new form, if you file a paper form.
What will be helpful with form 1040-SR
It will be interesting to see if the new form will achieve its goal of streamlining the filing process for seniors. Here are a few of the highlights:
- The spaces for entering information on the paper form are larger than on the regular 1040 form.
- A chart on the front page gives standard deductions by filing status.
- Certain important income categories for seniors are specifically highlighted, including IRA distributions, pension income, and Social Security benefits.
- The tax credit for children or other dependents is prominently featured on the 1040-SR.
- Seniors age 65 or older are also entitled to an extra standard deduction of $1,300.
What’s not so great about 1040-SR
We’re all about streamlined forms that make the filing process smoother and more efficient. If there’s a group that can use a slimmed-down approach to tax filings, it’s this senior age group. Here are a few downsides to the new form:
- You must be 65 in the calendar year to file this form, even if you’re already retired.
- If you use tax filing software, the differences between the new 1040-SR and form 1040 won’t be noticeable.
- If you decide to itemize deductions instead of taking the standard deduction, you’ll have to fill out a separate schedule. That might not be a time-saver.
Contact Morgan & Associates CPAs today if you’d like expert help with your tax filings this year. We can help you decide what is the best form for your financial situation.