this is the period of time in
which you can amend your tax return to claim a credit or refund. The statute
of limitation period is also the time frame that the Internal Revenue
Service can assess additional tax on your tax returns.
The period of time called
the statute of limitations is different depending on your tax situation. In
normal filing situations and if things are done in the order as they should
be done, such as filing your tax return on time and paying on time. If you
do not have special situation situations that apply to you, then your
statute of limitations to keep your reports is 3 years. This period of
limitation is 7 years if you filed a claim for a loss from worthless
securities or if you had a bad debt deduction. Additionally, if you do not
report all of your income, the statute of limitation is 6 years. Your
statute of limitation never runs out if you never file a tax return for that
year or you filed a fraudulent tax return. Furthermore, if you have
employees, your statute of limitations is 4 years after the tax becomes due
or paid whichever is later, in case the Internal Revenue Service wants to
see your employment tax records.
You can use Form 1040EZ if your
filing status is Single or Married Filing Jointly, your taxable income is
less than $100,000, and you are not a debtor in a Chapter 11 bankruptcy case
filed after October 16, 2005. You must use Form 1040A or Form 1040 if you
received interest as nominee. You must also use Form 1040A or Form 1040 if
you received a 2014 Form 1099-INT for having U.S. savings bond interest that
includes amounts you reported before 2014. If you owned or had authority
over one or more foreign financial accounts with a combined value over
$10,000 at any time during 2014 you also must use either Form 1040A or Form
1040 to report this transaction. There are a few items that you can fit into
a Form 1040EZ form. The rest go on either Form 1040A or Form 1040. You can
always start with a Form 1040EZ and if there is not space for the item you
have, then you go to a Form 1040A. Finally if there is no space on that Form
1040A for your items you can give up and use a Form 1040 instead. You can
save a lot of time, effort and money, if you know what takes what to start
out with.
There is a fantastic analogy in
a Tax Act blog "The
Difference Between Form 1040, 1040A and 1040EZ" for using the various tax
forms. Filing the three different kinds of returns 1040EZ, 1040A, and 1040
is like having three water glasses of different sizes where Form 1040EZ
would be an 8 ounce glass, 1040A would be a 12 ounce glass and Form 1040
would be a 24 ounce glass. Just like you can use a 24 ounce glass to drink 8
ounces or 12 ounces of water, you can use Form 1040 to file tax returns that
can be filed on Form 1040EZ and Form 1040A. However, just like you cannot
drink 24 ounces of water from an 8 ounce or 12 ounce glass, you cannot file
a Form 1040 or 1040A tax return on a Form 1040EZ or a Form 1040 tax return
on a Form 1040A. You get the idea?
Regardless of the manner that your PIN is
generated, to file your tax return electronically, you must sign the tax
return electronically using the personal identification number (PIN).
For example on October 22, 1986, President Reagan
signed into law the Tax Reform Act of 1986. The act called for an decrease
in individual taxation over a five-year period.
Over the years, the tax laws
got so complicated that there was a need to simplify the tax code. The tax
code and the paperwork to file a tax return was a difficult bureaucratic
effort. Additionally, President Reagan wanted to up the economy with his tax
law reform. We are living this tax reform presently.
