What Is the Schedule 1 Tax Form?
- Schedule 1 is a form that must be attached to some yearly tax returns. Keep reading to learn more about what the Schedule 1 includes and why it's needed.
In 2021, the Internal Revenue Service processed more than 260 million federal tax returns. If you typically fill out a 1040, you may need to complete Schedule 1, which lists certain types of income and expenses. Read on to learn more about Schedule 1 and how it's used.
What Is a Schedule 1?
Schedule 1 is a tax form used to help calculate your adjusted gross income (AGI). This is where you list any income that didn't come from wages, bank interest or dividends from your investments. It's also the form used to record certain adjustments to income.
Do I Need to File a Schedule 1?
Not all taxpayers are required to file Schedule 1 with their annual returns. Typically, you must use Schedule 1 if one or both of the following apply to your tax situation:
- You have any type of income that isn't wages, investment dividends or bank interest. This includes unemployment income and rental income.
- You need to report at least one of the 12 types of expenses that can be excluded from your taxable income.
Types of Income Reported on Schedule 1
The following types of income aren't included in a 1040, so they must be reported on a Schedule 1 instead:
- Tax refunds
- Credits for local and state income taxes
- Unemployment income
- Alimony received (if the agreement was active prior to 2019)
- Gains or losses from the sale of business property
- Business income and losses
- Farm income
- Rental income
- Trust income
- Income from an S corporation or partnership
- Royalty payments
- Canceled debt
- Income from awards
- Certain insurance dividends
Adjustments to Income Reported on Schedule 1
The IRS allows you to adjust your income by reporting the following types of expenses on Schedule 1:
- HSA contributions: If you used post-tax funds to contribute to a health savings account, you can list your contributions on the Schedule 1 form.
- Alimony paid: You can deduct any alimony you paid, as long as your alimony agreement went into effect before 2019.
- Student loan interest: You're allowed to deduct up to $2,500 in student loan interest.
- Tuition and fees: Schedule 1 is where you record any tuition you paid for yourself, a spouse or a dependent.
- Educator expenses: If you're an educator, you can deduct up to $250 in expenses.
- Moving expenses: If you're an active member of the Armed Forces, you may be able to deduct moving expenses on Schedule 1.
- Business expenses: The IRS allows certain taxpayers to deduct business expenses on Schedule 1. This includes performing artists, fee-basis government officials and members of the military reserve forces who have to travel more than 100 miles to perform their duties.
- Self-employed health insurance premiums: If you're self-employed, you can include health insurance premiums on Schedule 1.
- Self-employment tax: If you had self-employment income, you can deduct 50% of the corresponding self-employment tax on Schedule 1.
- Penalties for early savings withdrawal: If you were penalized for an early withdrawal, you may be able to deduct the penalty amount on Schedule 1.
- Retirement account contributions: If you're self-employed or own a small business, the IRS allows you to deduct some retirement account contributions.
- IRA contributions: If you used post-tax funds to contribute to a traditional IRA, the IRS allows you to deduct the contributions on your tax return.
The amount of money you spent on these items is used to reduce your taxable income. Depending on your tax situation, reducing your taxable income may result in a larger refund or a lower amount due when you file your return.
Instructions for Completing Schedule 1 for 2022
When you file your tax return for 2022, you'll need to write your name and Social Security number on Schedule 1. If your status is married filing jointly, you'll also need to record your spouse's name and Social Security number. Make sure the information matches what you wrote on the 1040.
Here's what you should do, line by line, to complete Schedule 1 for 2022.
- Line 1: Enter the amount you earned from tax credits, tax refunds or offsets for local/state income taxes. You may have received a 1099-G form showing this amount.
- Line 2: On line 2a, enter the amount of alimony you received during the tax year. Line 2b is where you enter the date you entered the alimony agreement.
- Line 3: Record any income or loss generated by a business. You'll need to file a Schedule C if you have business income.
- Line 4: Record income or losses from the sale or trade of a business property. You'll also need to file Form 4797 with your federal return. Some taxpayers need to file additional forms if they have this type of income.
- Line 5: Enter any rental income, royalties, trust income or income derived from an S corporation or partnership.
- Line 6: Record any farm income you earned during the tax year. You'll also need to complete Schedule F.
- Line 7: Use form 1099-G to record the amount of unemployment income you received.
- Line 8: List any income that you didn't list on your 1040 or earlier in the Schedule 1. This includes gambling winnings, canceled debt and prizes.
- Line 9: Add up the amounts you entered on lines 8a through 8p and line 8z.
- Line 10: Add lines 1 through 7 to line 9. Transfer the total to line 8 on your 1040.
- Line 11: Report any educator expenses you incurred during the tax year. The limit is $250.
- Line 12: Record any business expenses you incurred as a performing artist, government official paid on a fee basis or member of the military reserves who traveled more than 100 miles to perform your reserve duties. Complete and attach Form 2106.
- Line 13: Enter any contributions made to a health savings account with post-tax funds. You'll also need to complete Form 8889.
- Line 14: Record any moving expenses you incurred due to a permanent change of duty station. This applies to active-duty members of the Armed Forces. You'll also need to complete Form 3903.
- Line 15: Record half of your self-employment tax for the year. You'll also need to attach Schedule SE.
- Line 16: Record any retirement contributions you made as a self-employed individual.
- Line 17: Enter the total amount paid for health insurance, dental insurance and long-term care insurance premiums. This applies to self-employed taxpayers. If you need help determining how much you can deduct, use the Self-Employed Health Insurance Deduction Worksheet in the instructions for Schedule 1.
- Line 18: Record any penalties you owe for early withdrawal from a savings account.
- Line 19: Enter the amount of alimony you paid on line 19a. Line 19b is for the recipient's Social Security number. On line 19c, enter the date your divorce agreement went into effect.
- Line 20: Enter contributions to a traditional IRA made with post-tax dollars.
- Line 21: Record the amount of student loan interest you paid, up to $2,500.
- Line 22: This line is blank.