Friday, January 3, 2020


The biggest change in federal tax forms for 2019 returns filed in 2020 is the return to sanity.  The completely ridiculous “postcard” format of the 2018 return is gone!  The 2019 Form 1040 is most definitely “more better” – and returns to a more logical flow of information. 

There is a new Form 1040-SR for senior filers, created for no other reason than it was required by the Bipartisan Budget Act of 2018, which is exactly the same as the 2019 Form 1040 except it has bigger print and includes a Standard Deduction chart. 

Here is a good summary of the specific changes to Form 1040 that I found online –

·         Moved total from Schedule D (Capital Gain/Loss) from Schedule 1 to Form 1040, page 1
·         Split IRAs and pensions/annuities into two lines – one for IRA distributions and one for pensions and annuities
·         Removed checkbox for health insurance coverage
·         Moved signature area to bottom of page 2
·         Returned foreign address and third-party designee to Form 1040 address area (was on Schedule 6)
·         Added line for total additional income from Schedule 1
·         Added line for total adjustments to income from Schedule 1
·         Form 1040 will now print as two pages since the changes that were made takes up more than one half of each page

And the previously 6 supplemental schedules to the 1040 have been reduced to 3.  Schedule 2 and 4 are combined in the 2019 Schedule 2, Schedule 3 and 5 are combined in Schedule 3 for 2019, and the information previously reported on Schedule 6 is now on the 1040.  The 2019 Schedule 1, like 2018, reports additional income and adjustments to income, the 2019 Schedule 2 reports all additional taxes, and the 2019 Schedule 3 reports nonrefundable credits and other payments and refundable credits. 

The infamous “extenders” were extended by Congress after the IRS “went to press” with the 2019 Form 1040, 1040-SR and supplemental schedules and Schedule A.  The 2019 Schedule 1 has a line 21 under “Adjustments to Income” identified as “Reserved for future use”, which is where I expect you would enter the newly extended deduction for qualified tuition and fees.  There is already a line for the Residential Energy Credit on Schedule 3, referring to Form 5695, and the 2019 Form 5685 has not yet been released. 

But the 2019 Schedule A shows 10% as the AGI threshold for medical deductions, which is now back to 7½%, and the 2019 instructions for Schedule A has been released referencing the 10% threshold.  The 2019 Form 8615 and is instructions have been released without reference to the apparent option to calculate the tax under the old pre-GOP Tax Act method.  This is another reason retroactive tax legislation, especially extending extenders, should not be done at year-end.  But then the idiots in Congress are truly idiots.

New for 2019 filings are Form 8995 and Form 8995-A to calculate the Qualified Business Income Deduction that was created by the GOP Tax Act and first available on the 2018 Form 1040.  Previously the deduction was calculated using worksheets that were not included with the 1040 filing.  The 8995 is for simple calculations, and the 8995-A is for more complicated calculations.

The Schedule C-EZ is apparently gone for 2019.  I am actually sorry to see it go.


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