Afraid of income taxes? A new tool to help understand the 1040.
Need help understanding the 1040 as we enter the homestretch of this year鈥檚 tax filing season? The Tax Policy Center has created a new interactive tool to walk you through key parts of the federal income tax, ranging from the mundane to the arcane.
In bite-sized pieces,聽聽discusses the main tax form, explaining the different filing statuses, who counts as a dependent, and what income is taxed (and what income isn鈥檛). How do deductions and credits cut your tax bill and how does the AMT boost it? And how does the income tax help you pay for college, health care, and retirement?
With tax trivia (we used to聽) and facts (just聽聽will owe AMT for 2014 but they鈥檒l pay an聽), the new feature explains many aspects of the income tax. It won鈥檛 make it easier to file your taxes but it might make the process a bit more interesting.
We have also updated our聽. Inaugurated last year, this web tool allows users to examine each individual line of the 1040 and Schedule A (itemized deductions). Pop-up boxes contain brief explanations and links to distributional tables and other TPC resources on each topic.
For example, clicking on line 13 reveals that 鈥淥ver 20 million taxpayers reported net capital gains of $621 billion in 2012鈥� and a linked distribution table shows that taxpayers with adjusted gross income over $10 million聽聽in 2012.
Take a break from the tedious paperwork and explore our new web tools. Maybe you鈥檒l find that income taxes aren鈥檛 so scary after all.
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