Form 1040 Schedule 1 Filing Checklist for Tax Year 2019
Overview and Purpose
Schedule 1 reports additional income and adjustments to income not captured on the simplified Form 1040. This schedule is mandatory for taxpayers with income beyond wages, interest, dividends, retirement distributions, and Social Security benefits, or those claiming above-the-line deductions. Schedule 1 consists of two parts: Part I for additional income and Part II for adjustments that reduce the adjusted gross income.
Pre-Filing Requirements
Virtual Currency Question
All taxpayers must answer the question about virtual currency on Form 1040, page 1. This question appears above the filing status section and asks whether you received, sold, sent, exchanged, or otherwise acquired any financial interest in virtual currency during 2019.
Answer yes for any transaction beyond simply purchasing cryptocurrency with real currency. Answer no only if you bought virtual currency with no other transactions or had no virtual currency activity.
Gather Required Documents
Collect all Forms W-2, 1099-INT, 1099-DIV, 1099-R, 1099-G, 1099-MISC, SSA-1099, and Schedule K-1 forms. Gather receipts and documentation for expenses you plan to deduct. Please have your prior year's tax return available for reference.
Step-by-Step Completion Guide
Part I: Additional Income
Step 1: Complete Header Information
Enter your name and Social Security number exactly as shown on Form 1040 or Form 1040-SR.
Step 2: Report State and Local Tax Refunds (Line 1)
Enter taxable state or local income tax refunds received in 2019 if you itemized deductions in the prior year. If you claimed the standard deduction last year, this refund is not taxable.
Step 3: Report Alimony Received (Lines 2a-2b)
Enter alimony received on line 2a only if your divorce or separation agreement was executed before January 1, 2019. Enter the agreement date on line 2b. Alimony from agreements executed on or after January 1, 2019, is not taxable and should not be reported.
Step 4: Report Business Income or Loss (Line 3)
Complete Schedule C showing all business revenues and expenses. Enter the net profit or loss from Schedule C line 31 on Schedule 1 line 3. Attach Schedule C to your return.
Step 5: Report Gains or Losses from Business Property (Line 4)
Complete Form 4797 for sales of business property, depreciable assets, or business real estate. Enter the total gain or loss from Form 4797 on Schedule 1 line 4. Attach Form 4797 to your return.
Step 6: Report Rental and Pass-Through Income (Line 5)
Complete Schedule E for rental properties, royalties, partnerships, S corporations, and trusts. Include all Schedule K-1 forms received. Enter the combined income or loss from Schedule E line 41 on Schedule 1 line 5. Attach Schedule E and all Schedule K-1 forms.
Step 7: Report Farm Income or Loss (Line 6)
Complete Schedule F showing farm revenues and expenses. Enter the net profit or loss from Schedule F line 34 on Schedule 1 line 6. Attach Schedule F to your return.
Step 8: Report Unemployment Compensation (Line 7)
Enter total unemployment compensation from all Forms 1099-G, box 1. This includes state, federal, and railroad unemployment benefits.
Step 9: Report Other Income (Line 8)
List type and amount of any income not reported on lines 1-7. Examples include prizes, awards, gambling winnings, jury duty pay, taxable scholarships not on Form W-2, and particular canceled debt.
Step 10: Calculate Total Additional Income (Line 9)
Add lines 1 through 8. Enter total on line 9. Transfer this amount to Form 1040 line 7a.
Part II: Adjustments to Income
Step 11: Claim Educator Expenses (Line 10)
Enter up to $250 of unreimbursed expenses if you are a K-12 teacher, instructor, counselor, principal, or aide who worked at least 900 hours during the school year. Qualified expenses include books, supplies, computer equipment, software, and classroom materials. If married filing jointly and both spouses qualify, the maximum combined deduction is $500, but neither spouse can exceed $250.
Step 12: Report Certain Business Expenses (Line 11)
Complete Form 2106 if you are an Armed Forces reservist with travel expenses exceeding 100 miles, a qualified performing artist meeting specific criteria, or a fee-basis government official. Enter allowable expenses from Form 2106 line 10 on Schedule 1 line 11. Attach Form 2106.
Step 13: Claim Health Savings Account Deduction (Line 12)
Complete Form 8889 showing HSA contributions and high-deductible health plan coverage. Enter deductible HSA contribution from Form 8889 line 13 on Schedule 1 line 12. Attach Form 8889.
Step 14: Report Moving Expenses for Armed Forces (Line 13)
Complete Form 3903 if you are active duty military with permanent change of station orders. Enter unreimbursed moving expenses from Form 3903 line 3 on Schedule 1 line 13. Attach Form 3903.
Step 15: Deduct Half of Self-Employment Tax (Line 14)
Complete Schedule SE calculating self-employment tax. Enter one-half of the self-employment tax from Schedule SE line 6 on Schedule 1 line 14. This deduction offsets the burden of paying both employee and employer portions of Social Security and Medicare taxes. Attach Schedule SE.
Step 16: Report Self-Employed Retirement Contributions (Line 15)
Enter contributions to SEP-IRAs, SIMPLE plans, or other qualified self-employed retirement plans. Contributions cannot exceed limits based on net self-employment income.
Step 17: Deduct Self-Employed Health Insurance (Line 16)
Enter premiums for medical, dental, vision, and qualified long-term care insurance for yourself, spouse, and dependents. Deduction cannot exceed net self-employment income minus one-half of self-employment tax.
Step 18: Report Early Withdrawal Penalties (Line 17)
Enter penalties for early withdrawal from certificates of deposit or similar savings accounts. Banks report these penalties on Form 1099-INT or Form 1099-OID.
Step 19: Claim Alimony Paid (Lines 18a-18c)
Enter alimony paid on line 18a only for divorce or separation agreements executed before January 1, 2019. Enter the recipient’s Social Security number on line 18b. Failure to provide this number results in $50 penalty. Enter agreement date on line 18c. Alimony paid under agreements executed on or after January 1, 2019, is not deductible.
Step 20: Deduct IRA Contributions (Line 19)
Enter traditional IRA deduction subject to income phaseouts if employer retirement plans cover you or your spouse. For 2019 phaseout ranges:
- Single or Head of Household with workplace plan: $64,000-$74,000 modified AGI
- Married Filing Jointly with active participant: $103,000-$123,000
- Married Filing Jointly with spouse covered: $193,000-$203,000
- Married Filing Separately with active participant: $0-$10,000
Step 21: Deduct Student Loan Interest (Line 20)
Enter up to $2,500 of student loan interest paid. Deduction phases out for 2019 between $70,000-$85,000 modified AGI for single filers and $140,000-$170,000 for married filing jointly. Not available if married filing separately. Use Form 1098-E if provided by the lender.
Step 22: Claim Tuition and Fees Deduction (Line 21)
Complete Form 8917 documenting qualified tuition and fees paid for yourself, spouse, or dependents at eligible institutions. Enter deduction from Form 8917 line 6 on Schedule 1 line 21. Cannot claim this deduction and education credits for the same student in the same year. Attach Form 8917.
Step 23: Calculate Total Adjustments (Line 22)
Add lines 10 through 21. Enter total on line 22. Transfer this amount to Form 1040 line 8a to reduce adjusted gross income.
Final Assembly and Filing
Verify Required Attachments
Ensure all required forms are completed and attached in proper order:
- Schedule C for business income
- Form 4797 for business property sales
- Schedule E for rental and pass-through income
- Schedule F for farm income
- Form 2106 for certain business expenses
- Form 8889 for HSA deduction
- Form 3903 for moving expenses
- Schedule SE for self-employment tax
- Form 8917 for tuition and fees
Confirm Accuracy
Verify that the name and Social Security number match exactly on Form 1040. Confirm that line 9 total transfers are correctly reported on Form 1040, line 7a. Confirm that line 22 total transfers are correctly reported on Form 1040, line 8a. Review all calculations for mathematical accuracy.
Attach to Return
Place Schedule 1 directly behind Form 1040 or Form 1040-SR as the first numbered schedule. Do not staple pages together.
Important Reminders
Schedule 1 is not required if you have only wages, interest, dividends, retirement income, Social Security benefits, and capital gains. Form 1040-SR is available for taxpayers age 65 or older with identical Schedule 1 requirements. Accurate completion ensures proper calculation of adjusted gross income, which affects eligibility for various deductions and credits throughout your return.
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This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance.
