I need to fill a W-4 form and a 1040 form using these information given:
- You will fill out two tax forms: (1) US Federal Income Tax Forms W-4 and (2) US Federal Tax Form 1040 as if you were Jane Doe. Tax information is in the scenario below.
Remember to sign the forms-given the limits of your technology, either sign, type or mention you tried to sign the forms. The IRS will return unsigned forms and charge you penalties.
- Upload the 2 completed tax forms through canvas.
- Go to the "Tax Return Worksheet" listed in the module as a second assignment. There you answer questions based on the numbers you got when filling out the tax forms.
Table of Contents
SCENARIO
- Jane Doe is single and has no children or dependents
- does not file as head of household
- does not hold multiple jobs.
- has no income from interest, dividends or retirement income
- is taking the Standard Deductions and is NOT itemizing his deductions or making other adjustments to income
- made no charitable contributions
- does not want additional withholding
- No one else can claim her as a dependent
- has normal vision
- name does not differ from that on his Social Security card
- was born in 1999
- lives in California
- is a programmer for ABC Enterprises and has no other jobs
- first day of employment was Jan 1, 2019
- does not want an additional amount withheld from his paycheck
- does not claim any exemptions from income taxes
- has no "Other Credits" to claim on his W-4
- Employer paid a full year of health insurance ==>> not applicable in 2020. Trump Admin got rid of penalties for not having health insurance
- Jane is filling out the form by herself and is not using a third party designee.
- will contribute to the Presidential Election Fund
- did not have any interest in virtual currencies
- The IRS did not send him an Identity Protection PIN
- All earned income is reported on his W-2 from ABC Corp
1040 Line by Line
- Lines 2-6: had no interest income or qualified dividends, nor any IRA withdrawals or Social Security benefits
- Line 7: had no capital gains
- Line 8: had no other income
- Line 10: had no adjustments
- Line 12a: Enter the Standard Deduction They put a little wonky box to the left on the form. Do not go to Schedule A
- Line 12b: had no charitable contributions
- Line 13: had NO qualified business deductions
- Line 16: Tax Here you look up his tax due on his Taxable Income line 15 in the Tax Tables in the IRS 1040 Instructions 2021 starting on page 65. Find his Taxable Income in the table, along the rows, then look at the "Single" column to find the tax due. (p. 32 has instructions on this line)
https://www.irs.gov/pub/irs-pdf/i1040gi.pdf (Links to an external site.)
Investopedia: How to read a tax table (Links to an external site.)
- Line 17: had none (enter 0)
- Line 19-20: had none (enter 0)
- Lines 23: had no other tax payments. Enter 0.
- Lines 26-31: Enter zero
- Line 38: does not owe a penalty because his tax due is less than $1,000 (See 2021 Instructions 1040 pg. 62.) Enter 0 <<==HINT
- Sign the form!! or mention that it needs to be signed in your submission.
- Phone number: 831-555-1212
- Email: [email protected]
1. PREPARE A W-4
- Go to irs.gov and download a Form W-4: irs.gov/Forms/W-4/W-4.pdf for 2022
- Fill out the W-4 form using the scenario above, including the information on the W-2, which is in the scenario
- Submit the completed W-4 here
- WARNING This is extremely simple! In 2020, the W-4 Form was redesigned by the IRS. It has been simplified and “allowances” are no longer used. Breathe and DO NOT OVER THINK IT. I have included the "How to Fill out a W-4" below for reference for students who may have more complicated taxes.
Resources:
How to Fill out a W-4 2020 (Links to an external site.)
IRS FAQ on the redesigned W-4 2020 (Links to an external site.)
2. PREPARE A 1040
Though you will likely file your taxes online using tax software like TurboTax, Going through the paper forms will show you how the calculations are done. Software creates easy to understand questions that prompt you for pertinent information, then plugs the numbers into the 1040 form. Understand that total income is reduced by adjustments and the standard deduction, and then the tax is based on this lower taxable income number. The amount of tax due is found by looking up the taxable income number in the tax tables, under the "filing status" column. The tax tables summarize all the tax calculations of the tax brackets. Line-by-line instructions are found in the 1040 instructions booklet. You will not use any supplemental forms for this assignment.
- Go to irs.gov and download a 1040 Individual Income Tax Return Form for 2021: irs.gov Forms & Instructions Form 1040 Form 1040.pdf
- Fill out the 1040 (Note: Use two decimal places for all numbers.) The scenario above will give line by line hints and entries.
- The instructions for the 1040: irs.gov Forms & Instructions Form 1040 Instructions for Form 1040
- Submit the completed 1040 in this assignment space
- Sorry, no links, find them yourself. It’s part of the assignment.
TIPS
With tax forms, the key is to take them line by line and NOT OVERTHINK THEM. Answer the questions directly and do not add any additional information, or "what ifs". The IRS already has done that. Follow the math calculations closely–what line is subtracted from what line.
Carefully refer to the information listed on the scenario for John Doe when filling out the forms. It will give you all the answers you need. You are welcome to work in groups on the assignment.
Note: In 2018, the Trump tax reforms significantly changed with the Forms and documentation. (A big change was the elimination of tax exemptions.) The limited time the IRS had to update the documents resulted in forms that are more cumbersome and the instructions are difficult to understand. I have made notes to guide you through the forms.
Do not reveal, publish online or turn in any actual personal financial information such as your Social Security number, bank or investment account numbers. Financial information is highly confidential. This class is to teach you how to manage your financial life but does not require you to reveal personal information. Illustrative purposes only!!
NEXT STEP
Complete the next item in the module: Tax Return Worksheet/Quiz You will fill in answers based on how you filled out the tax return.
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