What the Form Is For

Schedule 1 is an attachment to your main Form 1040, 1040-SR, or 1040-NR tax return that serves two important purposes: capturing income that doesn't fit neatly on the main form, and claiming valuable deductions that reduce your taxable income.

Think of your tax return as a puzzle. The main Form 1040 handles the most common pieces—wages from your W-2, Social Security benefits, and standard tax credits. But many taxpayers have additional pieces that don't fit on that main form. That's where Schedule 1 comes in.

It's divided into two parts:

• Part I reports “Additional Income” from sources like unemployment benefits, business income, gambling winnings, or alimony you received.
• Part II reports “Adjustments to Income” (sometimes called “above-the-line deductions”) such as student loan interest, educator expenses, IRA contributions, and health savings account contributions.

These adjustments reduce your Adjusted Gross Income (AGI) before you even consider the standard deduction or itemizing. A lower AGI can help you qualify for other tax benefits and credits that have income limits.

The IRS made significant changes to Schedule 1 for 2022, moving several income types that previously appeared on the main Form 1040 to new lines on Schedule 1, including scholarships not reported on W-2s, certain pension distributions, and wages earned while incarcerated.

When You’d Use It (Late/Amended Returns)

You need to file Schedule 1 with your 2022 tax return if you have any income listed in Part I or any adjustments listed in Part II.

The standard filing deadline was April 18, 2023 (extended from April 15 due to Emancipation Day in D.C.). If you missed this deadline, file as soon as possible to minimize penalties and interest.

If you filed Form 4868 for an automatic six-month extension, your extended deadline was October 16, 2023. Remember: extensions give you more time to file paperwork, not to pay taxes—those were still due by the original April deadline.

For amended returns, if you discover unreported income or missed adjustments, file Form 1040-X (Amended U.S. Individual Income Tax Return). You generally have three years from the original filing date or two years from the date you paid the tax (whichever is later) to claim a refund.

Special timing rules apply to:

• Members of the Armed Forces serving in combat zones (extra time to file).
• Taxpayers living abroad, who automatically receive a two-month extension to June 15, though interest still accrues from the original due date.

Key Rules for 2022

Structural Changes

The IRS expanded Form 1040 line 1 into multiple sublines (1a–1z), moving many income types to Schedule 1.
Notable changes:

• Scholarship/fellowship grants not reported on Form W-2 → Schedule 1, line 8r
• Pensions from nonqualified deferred compensation plans → line 8t
• Wages earned while incarcerated → line 8u

Form 1099-K Reporting

Third-party payment platforms were supposed to start issuing Form 1099-K for smaller amounts. If you received one incorrectly (e.g., for selling personal items at a loss), you can:

1. Ask the issuer to correct it.
2. If not corrected, report it on line 8z, then subtract it on line 24z with an explanation.

Educator Expenses

Capped at $300 per educator ($600 if MFJ).
For 2022, PPE and COVID-19 supplies qualified as eligible expenses (line 11).

Student Loan Interest Deduction

• Max deduction: $2,500 (line 21).
• Phase-out begins at $70,000 MAGI ($145,000 MFJ) and ends at $85,000 ($175,000 MFJ).

Alimony Rules

Only pre-2019 divorce agreements qualify for taxable/deductible treatment.
All post-2018 agreements: alimony not taxable or deductible.

Step-by-Step Guide (High Level)

Step 1: Gather Your Documents

Collect all relevant income forms (e.g., 1099-G, 1099-MISC, 1099-C, W-2G, Schedule C/F/E) and adjustment records (e.g., 1098-E for student loans, 5498-SA for HSA, IRA contribution records).

Step 2: Complete Part I – Additional Income (Lines 1–10)

Report all applicable income, such as:

• Unemployment → line 7
• Gambling winnings → line 8b
• Taxable refunds → line 1

Use line 8z for miscellaneous income (e.g., prizes, IRA corrections).
Total all income on line 10, which carries to Form 1040, line 8.

Step 3: Complete Part II – Adjustments to Income (Lines 11–26)

Common adjustments include:

• Educator expenses → line 11
• Self-employment tax → line 15
• Self-employed health insurance → line 17
• IRA contributions → line 20
• Student loan interest → line 21
• HSA contributions → line 13

Add all adjustments on line 26 → Form 1040, line 10.

Step 4: Transfer Totals to Form 1040

• Part I total → Form 1040, line 8
• Part II total → Form 1040, line 10

Step 5: Attach and File

Attach Schedule 1 when filing:

• E-filers: software does it automatically.
• Paper filers: attach Schedule 1 (sequence 01) behind Form 1040.

Common Mistakes and How to Avoid Them

Forgetting to File Schedule 1

If you have 1099 income or claim adjustments (student loans, IRA, educator expenses), you must include Schedule 1.

Math Errors

Double-check lines 10 and 26. Use software or a calculator to prevent compounding errors.

Reporting Nontaxable Income

Common mistakes: including child support, gifts, or personal item sales at a loss.
Review line 8z instructions carefully.

Missing Documentation

Keep receipts for educator expenses, IRA contributions, etc.
Without proof, your deductions can be denied.

Claiming Ineligible Adjustments

Check eligibility rules—especially for student loan interest and IRA deductions.
Use IRS worksheets for accuracy.

Incorrect SSNs for Alimony

Ensure your ex-spouse’s SSN is correct on line 19b, or your deduction may be disallowed.

Using the Wrong IRS Address

Always confirm the latest address in the Form 1040 instructions before mailing.

What Happens After You File

Processing times vary:

• E-file + direct deposit → usually within 21 days
• Paper filing → 6–8 weeks or longer

The IRS checks for math errors and mismatches, especially on Schedule 1 lines that cross-reference third-party forms like 1099-G or 1099-MISC.

If adjustments are claimed, the IRS may request verification. Educator expenses and student loan interest are sometimes audited.

Track your refund via “Where’s My Refund?” or the IRS2Go app:

• 24 hours after e-filing
• 4 weeks after mailing

If errors affect your refund or balance, the IRS will send a notice—review and respond promptly.

Keep your return and documentation for at least three years, or longer if you:

• Underreported income by more than 25% → 6 years
• Didn’t file or filed fraudulently → indefinitely

FAQs

Do I need Schedule 1 if I only have W-2 income?

No, unless you’re claiming adjustments like student loan interest or educator expenses.

Where do I report unemployment benefits for 2022?

Report them on Schedule 1, line 7 using Form 1099-G. All unemployment is fully taxable for 2022.

What’s the difference between Schedule 1 adjustments and itemized deductions?

• Schedule 1 adjustments reduce income before AGI.
• Itemized deductions (Schedule A) only apply if they exceed your standard deduction.
  Always claim above-the-line adjustments—they apply to everyone.

I received a Form 1099-K for selling personal items. Do I owe taxes?

No, not if you sold items at a loss. Report on line 8z, then subtract on line 24z with the note “Form 1099-K Personal Item Sold at Loss.”

Can I deduct student loan interest if my parents paid my loan?

Only if the loan is legally in your name and you’re obligated to repay it. The max deduction is $2,500, subject to income phaseouts.

What qualifies as educator expenses for line 11?

Up to $300 ($600 MFJ) for unreimbursed classroom materials, including COVID-19 PPE. Must work 900+ hours in K–12 education.

What if I forget to include Schedule 1?

E-filers are safe (software checks automatically).
Paper filers: the IRS will send a notice requesting the missing form, delaying refunds or correcting tax owed. File Form 1040-X to fix.