Millions of taxpayers will get good news when they open their 1993 tax forms.
For the first time, married couples with simple returns will be able to use the single-page 1040-EZ form to settle with the Internal Revenue Service.If you qualify - you must be under 65, with no dependents and taxable income under $50,000, among other things - the 1040-EZ can make even the short-form 1040A seem intimidating.
The IRS expects about 2.5 million couples to use the EZ-est of forms.
Other changes to note on '93 forms:
- If you're buying a home with the help of seller financing, you must report on Schedule A the Social Security number of the seller to whom you're paying interest.
If you're the seller, you must report the number of the buyer-borrower on Schedule B.
The point, of course, is so that the IRS can compare the amount of interest being deducted with the amount being reported as income.
- Schedule D, on which you report capital gains and losses, has a new, airy look: You no longer have to use teensy-weensy numbers to report your stock, bond and mutual-fund sales.
But there's a tradeoff. You have more room for reporting sales because the form no longer includes sections for applying the 28 percent cap on the taxation of long-term gains or for figuring the amount of loss carryovers to the following year.
Those computations are now on work sheets in the Schedule D instructions. Don't overlook them.
- And here's a way the government has come up with to get more for the same amount of effort.
If you normally check the box at the top of the tax form to give $1 to the presidential campaign fund, note that this year checking the box sends three of your tax dollars to the fund. The change was tucked away in last year's tax bill.