spb/ultra-sharp-agent-skills Public

1<!--2Author: Simon-Pierre Boucher3Contact: contact@spboucher.ai4-->56# Reference — US Personal Tax Return Preparation (Form 1040)78All dollar figures are **tax year 2026** unless noted — verify at [irs.gov](https://www.irs.gov) before use.910## Contents11- Schedule and form map12- Common income documents13- Standard vs itemized decision14- Credit table with phase-out notes15- Deadline calendar16- Penalty structure17- Worked mini-examples18- Gotchas1920## Schedule and form map2122| Situation | Where it goes |23|---|---|24| Wages (W-2) | 1040 line 1 |25| Interest / ordinary dividends | Schedule B (if > $1,500), else 1040 directly |26| Self-employment / gig income (1099-NEC, 1099-K) | Schedule C → SE tax on Schedule SE → Schedule 2 |27| Capital gains, crypto/stock sales (1099-B) | Form 8949 → Schedule D |28| Rental income, royalties, K-1 pass-through | Schedule E |29| Adjustments (student loan interest, HSA, IRA deduction, ½ SE tax) | Schedule 1 Part II |30| Other income (unemployment 1099-G, prizes, hobby) | Schedule 1 Part I |31| Additional taxes (SE tax, early-withdrawal penalty, NIIT, AMT) | Schedule 2 |32| Nonrefundable/refundable credits beyond CTC/EITC | Schedule 3 |33| Itemized deductions | Schedule A |34| Premium Tax Credit reconciliation (1095-A) | Form 8962 |35| Retirement distributions (1099-R) | 1040 lines 4–5; Form 5329 if early |3637## Common income documents3839- **W-2** — wages; one per employer; box 12 codes matter (D = 401(k), W = HSA employer contribution).40- **1099-NEC** — contractor income ≥ $600 → Schedule C, even without the form.41- **1099-INT / 1099-DIV** — interest/dividends; qualified dividends get capital-gains rates.42- **1099-B** — broker sales; check basis was reported; reconcile on Form 8949.43- **1099-R** — retirement distributions; code in box 7 drives taxability and penalty.44- **1099-K** — payment platforms; report gross then back out personal/nontaxable items on Schedule 1.45- **SSA-1099** — up to 85% of Social Security may be taxable depending on combined income.4647## Standard vs itemized decision4849Itemize on Schedule A only if the sum beats the standard deduction ($16,100 single / $32,200 MFJ):50- State and local taxes (SALT) — capped; verify the current cap for the tax year.51- Home mortgage interest (1098) — acquisition-debt limits apply.52- Medical expenses — only the portion above 7.5% of AGI.53- Charitable donations — cash and fair-market-value of goods; receipts required at $250+.5455Rule: compute both, take the larger, and record the comparison so the choice is auditable.5657## Credit table5859| Credit | Type | Key conditions |60|---|---|---|61| Child Tax Credit | Partially refundable | Qualifying child under 17 with SSN; phases out at higher AGI |62| EITC | Refundable | Earned income + AGI limits by family size; investment-income cap; frequent audit target — document eligibility |63| AOTC (education) | Partially refundable | First 4 years post-secondary, per student, needs 1098-T |64| Lifetime Learning | Nonrefundable | Any post-secondary; per return |65| Child & Dependent Care | Nonrefundable | Care enabling work; needs provider EIN/SSN |66| Saver's Credit | Nonrefundable | Retirement contributions at lower AGI |67| Premium Tax Credit | Refundable | Marketplace coverage; reconcile with Form 8962 — mandatory |6869Verify every phase-out threshold for the tax year at irs.gov; do not quote from memory.7071## Deadline calendar (for tax year 2026)7273| Date | Event |74|---|---|75| Jan 15, 2027 | Q4 2026 estimated payment |76| Jan 31, 2027 | W-2s and most 1099s due to recipients |77| Apr 15, 2027 | Filing + payment deadline; Q1 2027 estimate; IRA/HSA contribution deadline for 2026 |78| Jun 15, 2027 | Q2 estimate; automatic 2-month filing extension for taxpayers abroad (interest still runs) |79| Sep 15, 2027 | Q3 estimate |80| Oct 15, 2027 | Extended filing deadline (Form 4868 filed by Apr 15) |8182## Penalty structure8384- **Failure to file:** 5% of unpaid tax per month, max 25%. Minimum penalty applies after 60 days.85- **Failure to pay:** 0.5% per month, max 25%; drops to 0.25% under an installment agreement.86- Both apply → file penalty is reduced by pay penalty for the overlap; filing on time is always worth it.87- **Estimated-tax underpayment:** interest-based (Form 2210); avoided via safe harbor (90% current / 100% prior / 110% if prior AGI > $150k) or owing < $1,000.8889## Worked mini-examples9091**Example 1 — standard vs itemized.** Single filer: SALT $9,000 (under cap), mortgage interest $5,500, donations $1,200 → itemized $15,700 < standard $16,100 → take standard.9293**Example 2 — safe harbor.** 2025 total tax $18,000, AGI $120,000; 2026 income jumps. Paying 100% × $18,000 = $18,000 through withholding/estimates avoids the underpayment penalty regardless of the 2026 bill.9495**Example 3 — gig worker.** 1099-NEC $22,000, expenses $4,000 → Schedule C net $18,000 → SE tax ≈ 15.3% × (18,000 × 0.9235) on Schedule SE; half of SE tax deducts on Schedule 1.9697## Gotchas98- An extension extends **filing only** — estimate and pay by April 15 or penalties/interest run.99- 1099-K gross ≠ income: refunds, personal transfers, and basis must be adjusted, not ignored.100- Dependents with jobs: they file their own return but must check "can be claimed as a dependent" — double-claiming causes e-file rejects.101- Backdoor/IRA basis: Form 8606 must be filed every year with nondeductible contributions or basis is lost.102- MFS traps: loses EITC, education credits, and usually the child-care credit; both spouses must match standard/itemized choice.103- The IRS already has your W-2s/1099s — mismatches trigger automated CP2000 notices; reconcile every document, even small ones.104