Each year I help over 500 clients file their Canadian and US tax returns as well as plan for both their Canadian and US investment accounts. I also regularly help new US clients plan for their move to Canada.
The IRS recently announced the new “simplified” 2018 1040 form. The new version of the 1040 replaces the older 1040, 1040-A and 1040-EX forms. Trump announced the “simplified change” to the 1040 last year, however many are not so convinced this new version will simplify tax filings for taxpayers.
The new form, although shorter, still maintains most of the complexity of previous forms. The main difference being that most of the information contained on the front page will be coming from other forms in the package.
Considering the software options available to help taxpayers complete their annual 1040 returns, I’m not quite sure why the form needed to be changed materially. The most likely reason for the change was purely political. Reducing the complexity of tax returns is always a good idea, however to simply change the form and not actually make changes that will benefit taxpayers is simply “window dressing”.
We have to assume that the new version of the 1040 will be the same form available to US Citizens living in Canada. It also looks like the IRS released a new form aimed at departing Aliens. Those non-US citizens and green card holders (those considered residents for tax purposes) are required to file form 1040-C in the year they depart the US. This is in contrast to the previous filing requirements pursuant to the 1040-NR instructions regarding dual status filings.
Time will tell whether the new “simplified” 1040 form will actually save filing times for US taxpayers. My guess is, probably not.