How do tax forms get their names?
The IRS assigns the numbers sequentially, but keeps some numbers on ice in case related forms are created later. No, form 1 is no longer in use.
You may know that a 1040 is the form you need to send the Internal Revenue Service every year, but have you ever wondered where its name came from?
MainStreet, which has spent the better part of the past two months reminding you about your W-2s, 1098s, 1099s and the aforementioned 1040, contacted the IRS to find out if there was a method to the numerical madness.
"We pick them sequentially," a spokesperson from the IRS said, explaining that the Forms and Publications division, which is primarily responsible for the naming, will start at a certain number based on what its latest paperwork is designed to do and pick the next numeral available.
According to the IRS, whole blocks of numbers are actually set aside so that future forms-to-be can have a numerical assignment close to its already existing relatives.
For instance, a new real estate and gift tax return form would mostly likely end up with a number in the 700s, since that’s what other forms in that category go by. You could look to the 900s as another example of this type of number blocking, since those are largely devoted to employment tax returns.
This means that even though there is Form 14411, or the Systematic Advocacy Issue Submission Form, which has the highest numerical assignment in the IRS’s online database, there are not actually 14,441 tax forms currently in use.
What complicates the system a bit is that forms very closely related to an existing one can also have a letter assigned to them. Consider the 1040EZ, which can be used by a taxpayer who has a very straightforward tax return or the 1040-A, another simplified form for individuals that lets them report dividend income, but does not include itemized deductions.
These letters can also denote subdivisions. The best illustration of this organizational technique would be the W forms. Now, the "W" stands for "withholding." The IRS did say that back in the 1950s it stood for "wages and taxes," but did not explain what precipitated the change.
Of course, forms do become obsolete over time. The IRS said an obsolete form’s number, like the number of a legendary baseball player, is retired and will only come back into to play if the particular tax credit or procedure is resurrected. (This apparently happened with Form 5695, which used to apply to residential energy credits.)
It also explains why there currently isn’t a Form 1, which went obsolete in early 1970s and had something to do with "receipt for payment of the tax system," according to the IRS.
There are currently 1,176 forms available for download on the IRS website.
The infamous 1040 has been around since 1913. The IRS explained that that 1040 earned its name because, at the time, the number 1039 was already taken. It did not say what form, now obsolete, had previously been assigned that number.
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