IRS has released a draft version of Form 1040. Following is an edited version of a IRS communication (IR-2018-146, June 29, 2018) regarding the revised form.
The new 1040 would replace the current Form 1040 as well as the Form 1040A and the Form 1040EZ. This new approach will simplify the 1040 so that all taxpayers can use the same form. The new form consolidates the three versions of the 1040 into one simple form. At the same time, the IRS will still obtain the information from each taxpayer needed to determine their tax liability or refund.
The new Form 1040 uses a “building block” approach, in which the tax return is reduced to a simple form. That form can be supplemented with additional schedules if needed. Taxpayers with straightforward tax situations would only need to file this new 1040 with no additional schedules.
Since more than nine out of 10 taxpayers use software or a tax preparer, the IRS will be working with the tax community to prepare for the streamlined Form 1040. This will also help ensure a smooth transition for people familiar with software products and the interview process used to prepare tax returns.
Taxpayers who file on paper would use this new streamlined Form 1040 and supplement it with any needed schedules.
As we have mentioned before, the Enrolled Agent Exam will not begin testing topics related to the new tax laws passed and signed in December until May of 2019. Current testing is based on pre-tax reform rules.