Here’s how it works. You make money—maybe lots, that’d be neat. The government wants a piece of that action, so they ask you to file a Form 1040 that calculates what their share is. And if the 1040 could speak to you, this is what it would say:
- Income: Okay, first we've got to figure out how much money you made. I hope you kept your W-2's and 1099's because they'll tell you the exact number. Don't try and mess with me. The person who sent you your W-2's and 1099's sent the IRS a copy too, so we know how much you really did make.