Form 1040EZ is used by about 25 million taxpayers. Of the 3 major tax forms, it has the fewest number of lines (about 12) and is the simplest to complete. Before you decide to use this form, though, there are some restrictions associated with its use that you should know about.
For example, you can’t file Form 1040EZ if you itemize deductions or have income from self employment, alimony, or dividends or capital gains. You also can’t use this form if you want to claim any tax credits or deductions. This means that you can’t deduct charitable donations and mortgage interest paid, or claim the credits for child and dependent care expenses or education. You can, however, claim the Earned Income Credit.
You can use Form 1040EZ if all of these requirements apply:
Your filing status is single or married filing jointly.
You don’t claim any dependents.
Your taxable income is less than $100,000.
You had only wages, salaries, tips, taxable scholarship or fellowship grants, unemployment compensation, or Alaska Permanent Fund dividends.
Your taxable interest is $1,500 or less.
You don’t claim any adjustments to income. This means that you can’t claim student loan interest that you paid or take advantage of an IRA deduction.
The only tax credit that you claim is the Earned Income Credit.
You (and your spouse, if filing a joint return) were under age 65 and not blind at the end of 2007. If you were born on January 1, 1943, you’re considered to be age 65 and cannot use Form 1040EZ.
You didn’t receive any advance Earned Income Credit payments.
You don’t owe any household employment taxes on wages that you paid to a household employee.
You aren’t a debtor in a Chapter 11 bankruptcy case filed after October 16, 2005.
If any of the requirements listed above don’t apply, you must use either Form 1040A or Form 1040.