Form 1040

This is the annual income tax return filed by citizens and residents of the United States. It needs to be filed by individuals who exceed certain minimum amounts of income or revenue, for example: a married couple whose gross income exceeds approximately $24,800 (as adjusted annually for inflation) or for certain situations were a dependent child has gross income exceeding approximately $1,100 or a self-employed person whose net income exceeds $399 (no adjustment for inflation). The IRS has an interactive Q&A to help determine who must file.

Tax brackets are ranges of net taxable income that are subject to an ever increasing tax rate up to 37% for federal income tax. Up to 15.3% for SECA or self-employment tax (similar to Social Security tax). Up to 3.8% for NIIT or Net Inv. Inc. Tax and up to 1.45% for Add'l Medicare Tax (related to the ACA or Obamacare tax). In lieu of the federal income tax rate, there is an AMT or Alt. Min tax of up to 28% for certain situations. Not to be outdone, then there are other taxes and assessments and even credits that lower taxes. For some lower-income folks, there are so-called Refundable Credits that can actually lower taxes until they go negative and a refund is issued by the IRS. It can be daunting... enough to make one's head spin!