Fundamentals of the 1040 Business Income and Reporting

Overview

This course is designed for practitioners in their first through fifth years of practice. Through a theoretical and practical study of Form 1040 and selected accompanying schedules, the course reviews the fundamental rules governing the preparation of individual income tax returns. Participants will examine taxpayer filing requirements and filing status, dependency determinations, reporting different types of income and adjustments to income, and the distinction between business income and hobby income.

The course also reviews itemized deductions and the standard deduction, common refundable and nonrefundable income tax credits, and documentation requirements for Earned Income Tax Credit (EITC) due diligence. In addition, the program addresses preparer responsibilities, ethical considerations in tax return preparation, and confidentiality, privacy, and disclosure requirements.

*Please Note:  If you need credit reported to the IRS for this IRS approved program, please download the IRS CE request form on the Course Materials Tab and submit to terri.storer@acpen.com

Highlights

• Schedule C: self-employment income, business deductions, and SE tax
• Schedule E and K-1 income from partnerships and S corporations
• Shareholder basis tracking using Form 7203
• Capital construction fund reporting (Form 7217)
• Business deductions and credits for individuals with business activity
• Audit risk areas and reporting red flags
• 2025 tax law changes affecting business income and pass-through reporting

Prerequisites

 Basic knowledge of individual tax return preparation, including Form 1040 core concepts 

Designed For

CPAs, EAs, tax professionals 

Objectives

At the end of this course, you will be able to:

• Analyze Schedule C for business income, deductions, and self-employment tax
• Interpret Form 7203 to assess shareholder stock and debt basis
• Apply Form 7217 for capital construction fund reporting
• Calculate self-employment tax and applicable deductions
• Identify IRS audit triggers and apply best practices for business income reporting
• Determine eligibility for key business deductions and credits
• Report pass-through entity income on Form 1040 using Schedule E and K-1
• Incorporate current legislative updates affecting business income taxation

Preparation

None

Notice

This course is offered by a 3rd party vendor and will not be accessible in the My CPE Tracker section of the ISCPA website. Course access information will be emailed directly to you by Accounting Continuing Professional Education Network (ACPEN).