Different variants of Form 1040 are available and at time it becomes confusing to select which one would suit you the most. As the name suggests the Form 1040EZ is supposed to be the easiest of them all but still you might be benefit more from filing a 1040 or a 1040A instead in few cases. There are number of credits available in form 1040 and 1040A which can be claimed as the same credits are not available in the 1040EZ version. Therefore one may be entitled to receive a larger refund while filing 1040 or 1040A. Let us discuss few of such provisions.
In case you or your child is taking a course in college it might qualify you under the Hope Education Credit scheme of IRS. Under another scheme i.e., American Opportunity credit, some portion of credits for Hope Education Credits are also refundable. Not only that the credit limit under this scheme has also been increased to $ 2500 for most of the taxpayers. The new name of the scheme has also been changed to American Credit scheme. Taxpayers should be aware of this to avoid any further confusion on the subject matter.
Another benefit of filing 1040 is that in case you have purchased a new car on which you have paid state taxes such as the local sales tax, you may get deduction of these taxes while filing your returns. Even in the states where sales taxes are not applicable you still can deduct other fee or taxes which you might have paid on purchase of the new car.
Yet another advantage of filing form 1040 is first time home buyer credit scheme. These credits cannot be earned while filing 1040EZ. The credits under this scheme have also been increased to $ 8000 for joint returns and $ 4000 for separate returns.
If above was not enough there is yet another important credit scheme which you can get benefited from while choosing to file 1040 instead of 1040 EZ, this is Energy Credit scheme. In case you have installed some energy saving equipments or items such as thermal windows, heating system, insulations, and appliances you can take benefits under this scheme. In case you have purchased an electric driven motor vehicle you can also take credits for using a energy efficient vehicle.
Therefore if you have made anyone of the above expenses which qualify for generating extra tax credits you should choose to file form 1040 over 1040EZ.