New tax form is the size of a postcard, but more complicated than ever
The Trump administration’s new “postcard” tax form should always be mailed in an envelope, unless you want your neighbors to see your Social Security number. This will save some taxpayers a little time but could add additional pages paperwork for millions more.
A draft copy of the new version of the Standard Income Tax Form 1040, obtained by the New York Times, shows that the administration has been successful in meeting its goal of reducing the form that most Americans send to the Internal Revenue Service annually. The new form eliminates more than half of the 78 lines of the previous form, reducing it from two full pages of text to half a double-sided page.
Consult the old form and the draft new form:
Smaller is not necessarily simpler. The new form omits a variety of popular deductions, including those for student loan interest and educational supplies, forcing taxpayers to seek out – and count them – on one of the six accompanying worksheets.
The same is true for business income, capital gains and many other forms of income. It includes a dedicated line for the expanded child tax credit, but not a line for child care expenses.
Like we said, there are a lot of worksheets. Again, a draft version:
Administration officials said they would unveil the new form this week. A person familiar with the new form said on Monday that it was supposed to replace not only the 1040, but the 1040A (the “short form”) and 1040EZ (for filers with no dependents). The new form “will be a postcard like we promised,” Treasury Secretary Steven Mnuchin said last week, “and hard-working taxpayers won’t have to spend so much time filling out their taxes.”
While the new tax law hasn’t significantly simplified the personal income tax code, millions of taxpayers could save some time on their returns this year, by skipping itemized deductions and claiming the newly standard deduction instead. extent. (This assumes that taxpayers know immediately if this is the smartest solution for them; if they don’t, they’ll still have to take the time to add up the itemized deductions and then compare to the standard deduction. )
But Democrats say there is nothing in the draft form, per se, that will simplify tax season for most Americans. The new form “only adds unnecessary complexity and confusion,” said Representative Lloyd Doggett of Texas, the top Democrat on the tax policy subcommittee. “The longer Form 1040, which all taxpayers have been using for decades, is being replaced by Republican mythology that will only complicate tax filing.”
The new form could complicate matters for the IRS, which suffered a critical malfunction on the filing deadline day this year. Over 90 percent of taxpayers currently file their taxes electronically, which is actually a boon for the agency as paper returns are more difficult to process. If the new form reverses this trend and persuades more Americans to mail their taxes, it could overwhelm an already stressed system.
An IRS spokesperson did not immediately respond to a request for comment on the draft Form 1040 on Monday afternoon.
President Trump is a huge fan of the idea of the postcard, which he praised throughout the tax debate last fall and into tax season this spring. The new postcard form, however, unfortunately does not include a provision in Mr. Trump’s campaign plan to simplify the code: a one-page form that Americans do not have to pay tax on. income could send to the Internal Revenue Service, which simply said: earn. ”