The U.S. tax code encompasses a vast array of sections, forms, and schedules. Below, an overview of some of the most commonly used forms and the sections of the Internal Revenue Code (IRC) that relate to them. This will include forms like the W-2 and 1040, which are central to tax reporting in the U.S.
Key Forms and Their Relevant IRC Sections
1. Form 1040 – U.S. Individual Income Tax Return
– Description: The primary form used by individuals to file their annual income tax returns with the IRS.
– Relevant IRC Sections:
– Section 1: Tax Imposed – Defines the tax rates for individuals.
– Section 63: Taxable Income Defined – Describes the calculation of taxable income.
– Section 61: Gross Income Defined – Defines what constitutes gross income.
– Section 62: Adjusted Gross Income – Details allowable deductions to arrive at AGI.
2. Form W-2 – Wage and Tax Statement
– Description: A form used by employers to report wages paid to employees and the taxes withheld from them.
– Relevant IRC Sections:
– Section 3402: Income Tax Collected at Source – Relates to the withholding of income tax from wages.
– Section 6051: Receipts for Employees – Details the requirements for providing employees with statements of wages and taxes withheld.
3. Form W-4 – Employee’s Withholding Certificate
– Description: Used by employees to indicate their tax situation to their employer, determining how much tax should be withheld from their paycheck.
– Relevant IRC Sections:
– Section 3402: Income Tax Collected at Source – Governs the withholding of income tax from wages.
4. Form 1099 Series
– Description: A series of forms used to report various types of income other than wages, salaries, and tips.
– Common Types of 1099 Forms:
– 1099-MISC: Miscellaneous Income.
– 1099-INT: Interest Income.
– 1099-DIV: Dividends and Distributions.
– Relevant IRC Sections:
– Section 6041: Information at Source – Governs the reporting of payments made in the course of trade or business.
– Section 6049: Returns Regarding Payments of Interest – Governs the reporting of interest income.
5. Form 940 – Employer’s Annual Federal Unemployment (FUTA) Tax Return
– Description: Filed by employers to report and pay federal unemployment taxes.
– Relevant IRC Sections:
– Section 3301: Rate of Tax – Defines the tax rate for FUTA.
– Section 3306: Definitions – Provides definitions related to employment taxes.
6. Form 941 – Employer’s Quarterly Federal Tax Return
– Description: Used by employers to report income taxes, Social Security tax, and Medicare tax withheld from employees’ paychecks.
– Relevant IRC Sections:
– Section 3402: Income Tax Collected at Source.
– Section 3101: Rate of Tax (FICA) – Governs Social Security and Medicare taxes.
7. Form 4562 – Depreciation and Amortization
– Description: Used to claim deductions for depreciation and amortization.
– Relevant IRC Sections:
– Section 167: Depreciation – Defines allowable depreciation deductions.
– Section 179: Election to Expense Certain Depreciable Business Assets – Allows businesses to deduct the full purchase price of qualifying equipment.
8. Form 8832 – Entity Classification Election
– Description: Used by an eligible entity to elect how it will be classified for federal tax purposes.
– Relevant IRC Sections:
– Section 7701: Definitions – Includes definitions related to business entities and their classifications.
9. Form 1065 – U.S. Return of Partnership Income
– Description: Used by partnerships to report income, deductions, gains, losses, etc.
– Relevant IRC Sections:
– Section 701: Partners, Not Partnerships, Subject to Tax – Defines tax liability for partnerships.
– Section 702: Income and Credits of Partner – Governs the treatment of income, deductions, and credits by partners.
10. Form 1120 – U.S. Corporation Income Tax Return
– Description: Used by corporations to report their income, gains, losses, deductions, and credits.
– Relevant IRC Sections:
– Section 11: Tax Imposed – Defines the tax rates for corporations.
– Section 61: Gross Income Defined.
Common Schedules Attached to Form 1040
1. Schedule A – Itemized Deductions
– Description: Used to claim itemized deductions such as mortgage interest, charitable contributions, and medical expenses.
– Relevant IRC Sections:
– Section 63: Taxable Income Defined.
– Section 170: Charitable Contributions.
2. Schedule B – Interest and Ordinary Dividends
– Description: Used to report interest income and ordinary dividends.
– Relevant IRC Sections:
– Section 61: Gross Income Defined.
– Section 6049: Returns Regarding Payments of Interest.
3. Schedule C – Profit or Loss From Business (Sole Proprietorship)
– Description: Used by sole proprietors to report income and expenses from their business.
– Relevant IRC Sections:
– Section 162: Trade or Business Expenses – Governs allowable business deductions.
4. Schedule D – Capital Gains and Losses
– Description: Used to report gains and losses from the sale or exchange of capital assets.
– Relevant IRC Sections:
– Section 1221: Capital Asset Defined – Defines what constitutes a capital asset.
– Section 1222: Other Terms Relating to Capital Gains and Losses.
5. Schedule E – Supplemental Income and Loss
– Description: Used to report income or loss from rental real estate, royalties, partnerships, S corporations, estates, and trusts.
– Relevant IRC Sections:
– Section 469: Passive Activity Losses – Governs the treatment of losses from passive activities.
6. Schedule SE – Self-Employment Tax
– Description: Used by self-employed individuals to calculate and report Social Security and Medicare taxes.
– Relevant IRC Sections:
– Section 1401: Rate of Tax – Defines the self-employment tax rate.
Conclusion
This overview covers some of the most commonly used tax forms and their related sections within the U.S. tax code. The tax code itself is vast, and these examples represent only a small fraction of the many provisions within it. If you need further information on any specific form or section, or if you are interested in less common tax forms, please contact IRS directly
!