Your taxable income must be less than $100,000 to use the Form 1040A.
Your income can come only from these sources:
- Wages, salaries, and tips
- Interest and dividends
- Capital gain distributions
- Taxable scholarship and fellowship grants
- Pensions, annuities, and IRAs
- Unemployment compensation
- Taxable Social Security and railroad retirement benefits
- Alaska Permanent Fund dividends
The only adjustments to income you can claim are the IRA deduction and the student-loan interest deduction — and you can also claim educator expenses and the tuition and fees deduction.
The only credits you can claim on the 1040A are:
- Child tax credit
- Additional child tax credit
- Education credits
- Earned Income Credit (EIC)
- Credit for child and dependent-care expenses
- Credit for the elderly or the disabled
- Retirement savings contributions credit
You can also use a 1040A if you receive dependent-care benefits or owe tax from the recapture of an education credit or the Alternative Minimum Tax (AMT).
A couple things to keep in mind about the 1040A: You can’t itemize deductions, which means you can’t deduct charitable donations or mortgage interest paid. Also, you can’t claim an AMT adjustment on stock acquired from exercising an incentive stock option.