Instructions for the Schedule 1040 A&B
- 1). Determine whether you need a Schedule 1040A and 1040B. You will need to complete a Schedule 1040A if you plan to claim itemized deductions, rather than a standard deduction. You will need to complete a Schedule 1040B if you need to report income from interest or dividends.
- 2). Assemble your paperwork for the Schedule 1040A. You will need receipts or other evidence of each item you intend to deduct, and the amount paid.
- 3). Complete your Schedule 1040A. You will need to enter each type of deduction you are claiming, and the amount of each. The most common deductions are medical and dental expenses. You may deduct the portion of these expenses which exceeds 7.5 percent of your taxable income in 2011. You may also deduct state and local income taxes or state and local sales taxes paid (you may deduct one, but not both), personal real estate taxes paid, certain motor vehicle taxes, certain home mortgage interest paid, qualified charitable contributions, losses from casualty or theft and business expenses. Enter each item in the appropriate box, then add, subtract and multiply as directed. When you reach the bottom of the form, you will have your total itemized deduction for use in your IRS Form 1040.
- 4). Assemble your paperwork for the Schedule 1040B. You will need receipts or other evidence of each type of interest or dividends you received.
- 5). Complete Parts I and II of Schedule 1040B. For Part I, enter all taxable interest you received. This includes taxable interest listed on any forms 1099-INT and 1099-OID which you received. It also includes interest you received from a seller-financed mortgage of qualified residential property. You may then exclude the interest from certain bonds purchases after 1989 and used for qualified educational expenses. For Part II, enter any dividends. These amounts will be found on any forms 1099-DIV you received. Total these amounts for use on your Form 1040 (Schedules 1040A and 1040B) or Form 1040A (Schedule 1040B).
- 6). Complete Part III of Schedule 1040B if your subtotal in either Part I or Part II of Schedule 1040B is greater than $1,500. Simply indicate whether you were the owner or beneficiary of the type of foreign holdings described, and indicate the name of the foreign country, if applicable. If you answer "yes," you may need to file additional forms with the IRS.
- 7). Include your Schedules 1040A and 1040B when you submit your Form 1040, or include your Schedule 1040B when you submit your Form 1040A.
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