1. Completing the 1040EZ 1040 EZ vs. 1040 A Day 3

2. Read the Tax Process article In your notebook: What is the maximum income you can earn in order to complete the 1040EZ? What is the maximum interest you can earn in order to complete the 1040EZ?

3. Gross Income - Money, goods, and property you received that must generally be reported on a tax return and may be included in taxable income. Earned Income - Wages, salaries, tips, and net earnings from self- employment and other income received for personal services Unearned Income - Income other than pay for work performed. Interest and dividends from savings or investments are common types of unearned income Interest Income - Income a person receives from certain financial accounts or from lending money to someone else. Adjusted Gross Income – A measure of income used to determine how much of your income is taxable. Adjusted gross income (AGI) is calculated as your gross income from taxable sources minus allowable deductions, such as unreimbursed business expenses, medical expenses, alimony and deductible retirement plan contributions.

4. Dependent – a person who relies on someone else for support Exemptions – A deduction from adjusted gross income for the taxpayer, the spouse, and qualified dependents Deduction – an expense that you can subtract from your adjusted gross income to figure your taxable income Standard Deduction - An amount, provided by law and bases on filing status, age, blindness, and dependency that taxpayers can deduct from their adjusted gross income before tax is determined Itemized Deduction – A specific expense that you can deduct from your adjusted gross income

5. http://www.irs.gov

7. 1040EZ Single, Married filing jointly No Dependents 1040A Single, Married filing jointly, Married filing separately, Head of Household, Qualifying Widow(er) Dependents

8. 1040EZ Taxable income of $100,000 Income from Wages, salaries, tips Taxable scholarships/grants Unemployment Income Alaska Permanent Fund dividends Interest less than $1500 1040A Taxable income of $100,000 Income from Wages, salaries, tips Taxable scholarships/grants Unemployment Income Alaska Permanent Fund dividends Interest (no maximum), dividends, capital gains Pensions, annuities, Individual Retirement Accountss Taxable Social Security and Railroad Retirement Benefits

9. 1040EZ Standard Deduction No Adjustments to income Tax Credit Earned Income Tax Credit (age 25+) 1040A Standard Deduction Adjustments to income Educator expenses Individual Retirement Account deduction Student loan interest deduction Tuition and fees deduction Tax Credits Earned Income Credit (age 25+) Child and dependent care Education credits Retirement savings contribution Child tax credit Additional child tax credit

10. 1040A Instructions

11. 1040 Instructions Taxpayers need to use the 1040 if they:  Have taxable income over $100,000  Itemize deductions: Mortgage interest, charitable deductions, certain job expenses  Are self-employed

12. http://www.irs.gov