1. 1 NY3 Instructor Training 2009 1040 Overview

2. 2 NY3 Instructor Training 2009 Federal Return (1040)

3. 3 NY3 Instructor Training 2009 1040 GENERAL INFORMATION General Information section identifies the taxpayer(s), dependents and filing status.

4. 4 NY3 Instructor Training 2009 1040 General Information

5. 5 NY3 Instructor Training 2009 Taxwise Forms  Taxwise forms are similar to IRS forms and documents  We transfer information from forms to Taxwise  Taxwise does all calculations

6. 6 NY3 Instructor Training 2009 1040 INCOME The Income section identifies and reports all types of income that applies to the taxpayer(s). Gross income is the sum of all taxable income sources and is shown on line 22.

7. 7 NY3 Instructor Training 2009 1040 Income Partial Support onlyNot Supported

8. 8 NY3 Instructor Training 2009 Taxwise W-2 input form  Taxwise forms generally have input areas with the same labels as user IRS forms to facilitate data entry.

9. 9 NY3 Instructor Training 2009 1040 ADJUSTMENTS Adjustments subtract from gross income to produce Adjusted Gross Income and is shown on line 37.

10. 10 NY3 Instructor Training 2009 1040 Adjustments Not Supported

11. 11 NY3 Instructor Training 2009 1040 Adjusted Gross Income  A djusted G ross I ncome = Sum of all taxable Income minus Sum of all Adjustments

12. 12 NY3 Instructor Training 2009 1040 DEDUCTIONS Standard deduction or Itemized Deductions.

13. 13 NY3 Instructor Training 2009 1040 Deductions  Deductions reduce income that is to be taxed.  Two ways to compute deductions (use the one that provides best benefit)  Standard Deduction  Itemized Deductions

14. 14 NY3 Instructor Training 2009 Schedule A – Itemized Deductions

15. 15 NY3 Instructor Training 2009 COMPUTE TAXABLE INCOME AND TAX OWED Taxes are computed using a graduated scale.

16. 16 NY3 Instructor Training 2009 Graduated tax scale Filing Status 10%15%25%28%33% Single0-$8,025 $8,025- $32,560 $32,560- $78,850 $78,850- $164,550 $164,550 - $357,700 Married Filing Jointly $0- $16,050 $16,050- $65,100 $65,100- $131,450 $131,450 - $200,300 $200,300 - $357,700 Head of Household $0- $11,450 $11,450- $43,650 $43,650- $112,650 $112,650 - $182,400 $182,400 - $357,700

17. 17 NY3 Instructor Training 2009 1040 Taxable Income & Tax owed  Taxable Income = Adjusted Gross Income minus Deductions (Standard or Itemized) minus Exemption amount ($3,650 times number)

18. 18 NY3 Instructor Training 2009 1040 CREDITS AND PAYMENTS Non-refundable credits, withholdings and refundable credits are all forms of payments.

19. 19 NY3 Instructor Training 2009 1040 Non-refundable Credits  Credits reduce tax liability dollar for dollar.  Non-refundable tax credits cannot exceed tax liability.

20. 20 NY3 Instructor Training 2009 1040 Payments  Payments  Payroll or Distribution Withholding  Estimated (Quarterly) Payments  Must be Timely  Expected to be current each quarter

21. 21 NY3 Instructor Training 2009 1040 Refundable Credits  Refundable credits will result in a refund if exceeds tax liability.

22. 22 NY3 Instructor Training 2009 1040 Refund or Balance Due  Balance due by April 15 th  Penalty may apply if balance due exceeds $1,000.  If there is a large refund, it is an interest free loan; consider adjusting withholding (W-4)

23. 23 NY3 Instructor Training 2009 1040 Signatures  Signers of the return are liable for its accuracy, whether or not they paid someone else to prepare it.  Tax aides do not sign and are not liable for the return.

24. 24 NY3 Instructor Training 2009 Federal Return Summary