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TAX YEAR2020(Rev. 4-2021)1040 and1040-SRRINSTRUCTIONSIncluding the instructions forSchedules 1 through 32020 Changes Recovery rebate credit. This creditis reduced by any economic impactpayments you received. Charitable contributions. You canclaim a deduction for charitablecontributions if you don't itemize yourdeductions on Schedule A (Form1040).For details on these and otherchanges, see What’s New in theseinstructions.Future DevelopmentsSee IRS.gov and IRS.gov/Forms, and for the latest information about developments related to Forms 1040 and1040-SR and their instructions, such as legislation enacted after they were published, go to IRS.gov/Form1040.Free File is the fast, safe, and free way to prepare and e-file your taxes. See IRS.gov/FreeFile.Pay Online. It’s fast, simple, and secure. Go to IRS.gov/Payments.Department of the Treasury Internal Revenue Service www.irs.govApr 13, 2021Cat. No. 24811V
Table of ContentsContentsDepartmentof theTreasuryInternalRevenueServicePageWhat's New . . . . . . . . . . . . . . . . . . . . . . . . 6Filing Requirements . . . . . . . . . . . . . . . . . . 9Do You Have To File? . . . . . . . . . . . . . . 9When and Where Should You File? . . . . . 9Line Instructions for Forms 1040 and1040-SR . . . . . . . . . . . . . . . . .Filing Status . . . . . . . . . . . . . .Name and Address . . . . . . . . . .Social Security Number (SSN) . .Dependents, Qualifying Child forChild Tax Credit, and Credit forOther Dependents . . . . . . . . .Income . . . . . . . . . . . . . . . . . .Total Income and Adjusted GrossIncome . . . . . . . . . . . . . . . .Tax and Credits . . . . . . . . . . . .Payments . . . . . . . . . . . . . . . .Refund . . . . . . . . . . . . . . . . . .Amount You Owe . . . . . . . . . . .13131515ContentsPageSign Your Return . . . . . . . . . . . . . . . . 64Assemble Your Return . . . . . . . . . . . . 652020 Tax Table . . . . . . . . . . . . . . . . . . . . 66General Information . . . . . . . . . . . . . . . . . 79Refund Information . . . . . . . . . . . . . . . . . . 84Instructions for Schedule 1 . . . . . . . . . . . . . 85Instructions for Schedule 2 . . . . . . . . . . . . . 97Instructions for Schedule 3 . . . . . . . . . . . . 102. . . . . 18. . . . . 23.-2-3030405861Tax Topics . . . . . . . . . . . . . . . . . . . . . . 106Disclosure, Privacy Act, and PaperworkReduction Act Notice . . . . . . . . . . . . 108Major Categories of Federal Income andOutlays for Fiscal Year 2019 . . . . . . . 110Index . . . . . . . . . . . . . . . . . . . . . . . . . . 112
Form 1040 and 1040-SRHelpful HintsFor 2020, you will use Form 1040 or, if you were born before January 2, 1956, you have the option to useForm 1040-SR.You may only need to file Form 1040 or 1040-SR and none of the numbered schedules, Schedules 1 through3. However, if your return is more complicated (for example, you claim certain deductions or credits or oweadditional taxes), you will need to complete one or more of the numbered schedules. Below is a general guideto which schedule(s) you will need to file based on your circumstances. See the instructions for the schedulesfor more information.If you e-file your return, you generally won't notice much of a change and the software you use will generallydetermine which schedules you need.IF YOU.THEN USE.Have additional income, such as business or farm income orloss, unemployment compensation, prize or award money, orgambling winnings.Schedule 1, Part IHave any deductions to claim, such as student loan interestdeduction, self-employment tax, or educator expenses.Schedule 1, Part IIOwe AMT or need to make an excess advance premium taxcredit repayment.Schedule 2, Part IOwe other taxes, such as self-employment tax, householdemployment taxes, additional tax on IRAs or other qualifiedretirement plans and tax-favored accounts.Schedule 2, Part IICan claim a nonrefundable credit other than the child tax creditor the credit for other dependents, such as the foreign tax credit,education credits, or general business credit.Schedule 3, Part ICan claim a refundable credit other than the earned incomecredit, American opportunity credit, or additional child tax credit,such as the net premium tax credit, health coverage tax credit, orqualified sick and family leave credits from Schedule H orSchedule SE.Have other payments, such as an amount paid with a request foran extension to file, excess social security tax withheld, or wantto defer the payment of some household employment orself-employment tax you may owe (for certain Schedule H andSchedule SE filers).-3-Schedule 3, Part II
The Taxpayer Advocate Service Is Here To Help YouWhat is the Taxpayer Advocate Service?The Taxpayer Advocate Service (TAS) is an independent organization within the Internal Revenue Service (IRS) that helpstaxpayers and protects taxpayer rights. TAS strives to ensure that every taxpayer is treated fairly and that you know andunderstand your rights under the Taxpayer Bill of Rights.What can TAS do for you?TAS can help you if your tax problem is causing a financial difficulty, you've tried and been unable to resolve your issue withthe IRS, or you believe an IRS system, process, or procedure just isn't working as it should. And the service is free. If youqualify for TAS assistance, you will be assigned to one advocate who will work with you throughout the process and will doeverything possible to resolve your issue. TAS can help you if: Your problem is causing a financial difficulty for you, your family, or your business. You face (or your business is facing) an immediate threat of adverse action. You’ve tried to contact the IRS but no one has responded, or the IRS hasn’t responded by the date promised.How can you reach TAS?We have offices in every state, the District of Columbia, and Puerto Rico. To find your advocate’s number: Go to TaxpayerAdvocate.IRS.gov/contact-us; Download Publication 1546, Taxpayer Advocate Service - We Are Here to Help You, available at IRS.gov/Forms-Pubs. Ifyou do not have internet access, you can call the IRS toll-free at 800-829-3676 and ask for a copy of Publication 1546; Check your local directory; or Call TAS toll-free at 877-777-4778.How can you learn about your taxpayer rights?The Taxpayer Bill of Rights describes ten basic rights that all taxpayers have when dealing with the IRS. The TAS Tax Toolkitat TaxpayerAdvocate.IRS.gov can help you understand what these rights mean to you and how they apply. These are your rights.Know them.How else does the Taxpayer Advocate Service help taxpayers?TAS works to resolve large-scale problems that affect many taxpayers. If you know of one of these broad issues, please report itto TAS at IRS.gov/SAMS. Be sure not to include any personal taxpayer information.Low Income Taxpayer Clinics Help TaxpayersLow Income Taxpayer Clinics (LITCs) are independent from the Internal Revenue Service (IRS) and the Taxpayer AdvocateService (TAS). LITCs represent individuals whose income is below a certain level and who need to resolve tax problems withthe IRS. LITCs can represent taxpayers in audits, appeals, and tax collection disputes before the IRS and in court. In addition,LITCs can provide information about taxpayer rights and responsibilities in different languages for individuals who speakEnglish as a second language. Services are offered for free or a small fee. For more information or to find an LITC near you, seethe LITC page at TaxpayerAdvocate.IRS.gov/LITCMap or IRS Publication 4134, Low Income Taxpayer Clinic List. Thispublication is available online at IRS.gov/Forms-Pubs or by calling the IRS toll-free at 800-829-3676.Suggestions for Improving the IRSTaxpayer Advocacy PanelTaxpayers have an opportunity to provide direct feedback to the Internal Revenue Service (IRS) through the Taxpayer AdvocacyPanel (TAP). The TAP is a Federal Advisory Committee comprised of an independent panel of citizen volunteers who listen totaxpayers, identify taxpayers' systemic issues, and make suggestions for improving IRS customer service. Contact TAP atImproveIRS.org.-4-
Affordable Care Act — What You Need To KnowRequirement To Reconcile Advance Payments of the Premium Tax CreditThe premium tax credit helps pay premiums for health insurance purchased from the Marketplace. Eligibleindividuals may have advance payments of the premium tax credit made on their behalf directly to the insurancecompany.If you or a family member enrolled in health insurance through the Marketplace and advance payments of thepremium tax credit were made to your insurance company to reduce your monthly premium payment, you must attachForm 8962 to your return to reconcile (compare) the advance payments with your premium tax credit for the year.The Marketplace is required to send Form 1095-A by January 31, 2021, listing the advance payments and otherinformation you need to complete Form 8962.1. You will need Form 1095-A from the Marketplace.2. Complete Form 8962 to claim the credit and to reconcile your advance credit payments.3. Include Form 8962 with your Form 1040, Form 1040-SR, or Form 1040-NR. (Don’t include Form 1095-A.)Health Coverage ReportingIf you or someone in your family was an employee in 2020, the employer may be required to send you Form1095-C. Part II of Form 1095-C shows whether your employer offered you health insurance coverage and, ifso, information about the offer. You should receive Form 1095-C by early March 2021. This information maybe relevant if you purchased health insurance coverage for 2020 through the Health Insurance Marketplaceand wish to claim the premium tax credit on Schedule 3, line 8. However, you don’t need to wait to receive thisform to file your return. You may rely on other information received from your employer. If you don’t wish to claimthe premium tax credit for 2020, you don’t need the information in Part II of Form 1095-C. For more informationon who is eligible for the premium tax credit, see the Instructions for Form 8962.Reminder: Health care coverage. If you need health care coverage, go to www.HealthCare.gov to learn abouthealth insurance options for you and your family, how to buy health insurance, and how you might qualify to getfinancial assistance to buy health insurance.-5-
What's NewPostponed filing deadline. The deadline to file your 2020 Form 1040 or1040-SR and pay any tax due on your2020 return is postponed until May 17,2021. The extended deadline also applies to making contributions to individual retirement arrangements and healthsavings accounts. Estimated tax payment due dates are not changed, and thefirst estimated tax payment is due onApril 15, 2021.Unemployment compensation exclusion. These instructions have been revised and are being rereleased to reflectthe provision in the American RescuePlan of 2021, excluding up to 10,200of unemployment compensation paid in2020. Up to 10,200 of unemploymentcompensation paid in 2020 is excludedfrom income if your modified adjustedgross income is less than 150,000. The 150,000 threshold applies to all filingstatuses even if your filing status is married filing jointly. If you are filing ajoint return, up to 10,200 of unemployment compensation paid to each spouseis excluded. See the instructions forSchedule 1, line 7, and the Unemployment Compensation Exclusion Worksheet, later, for more information.When figuring the following deductions or exclusions from income, youneed to figure your adjusted gross income unreduced by the amount of unemployment compensation exclusion. Taxable social security benefits.See the Social Security Benefits Worksheet—Lines 6a and 6b, later. IRA deduction. See the IRA Deduction Worksheet—Line 19, later. Student loan interest deduction.See the Student Loan Interest DeductionWorksheet—Line 20, later. Nontaxable amount of the value ofOlympic or Paralympic medals andUSOC prize money. See the instructionsfor Schedule 1, line 8, later. Exclusion of interest from SeriesEE and I U.S. Savings Bonds issued after 1989. See Form 8815. Exclusion of employer-providedadoption benefits. See Form 8939.For information about any additional changes to the 2020 tax law or any other developments affecting Form 1040 or 1040-SR or the instructions, go to IRS.gov/Form1040. Tuition and fees deduction. SeeForm 8917. Deduction of up to 25,000 for active participation in a passive rental realestate activity. See Form 8582.Suspension of excess advanced premium tax credit (APTC) repayments.The American Rescue Plan Act of 2021suspended the repayment of excessAPTC amounts for 2020.If you have already filed your return,you don't need to take any action at thistime; don't file an amended return. SeeIRS.gov/Form8962 for more information.Economic impact payments—EIP 1and EIP 2. Any economic impact payments you received are not taxable forfederal income tax purposes, but they reduce your recovery rebate credit.Recovery rebate credit. This credit isfigured like last year's economic impactpayment, except eligibility and theamount of the credit are based on yourtax year 2020 information. See the instructions for line 30 and the RecoveryRebate Credit Worksheet to figure yourcredit amount.Other taxpayer relief. Recent legislation provided certain tax-related benefits, including the following. Election to use your 2019 earnedincome to figure your 2020 earned income credit. See the instructions forline 27 for more information on thiselection. Election to use your 2019 earnedincome to figure your 2020 additionalchild tax credit. See the instructions forline 28 and the Instructions for Schedule8812 for more information on this election. Educator expenses includeamounts paid or incurred after March12, 2020, for personal protective equipment, disinfectant, and other suppliesused for the prevention of the spread ofcoronavirus. See the instructions forSchedule 1, line 10, later. If you were impacted by certainfederally declared disasters, special rulesmay ap
deductions on Schedule A (Form 1040). For details on these and other changes, see What s New in these instructions. See IRS.gov and IRS.gov/Forms, and for the latest information about developments related to Forms 1040 and 1040-SR and their instructions, such as legislation enacted after they were published, go to IRS.gov/Form1040. Free File is the fast, safe, and free way to prepare and e- le .
