# Schedule 1-A: a part-by-part guide to the additional deductions form

Source: https://taxbracketsdesk.com/new-tax-law/schedule-1-a-additional-deductions
Publisher: Tax Brackets Desk (taxbracketsdesk.com), independent editorial site
Topic: New Tax Law Deductions
Last updated: 2026-09-18

> Schedule 1-A is the form you attach to Form 1040 to claim the four temporary deductions created by the 2025 tax law: qualified tips, the overtime premium, car loan interest on a new US-assembled vehicle, and the $6,000 senior deduction. Each has its own part and income phaseout. The total goes to Form 1040 line 13b, and you can use it whether or not you itemize.

## Key facts

- Attach to: Form 1040, 1040-SR or 1040-NR
- Number of parts: Six (MAGI, four deductions, total)
- Total carried to: Form 1040 line 13b (1040-NR line 13c)
- Tax years: 2025 through 2028
- Itemizing required: No; works with either deduction method

## What Schedule 1-A is for

The IRS created Schedule 1-A, titled Additional Deductions, for 2025 returns to hold the four deductions added by Public Law 119-21. Before this form, below-the-line deductions went on Schedule A or the standard deduction line. These new ones sit in their own space so every filer can take them.

You file the Schedule 1-A form only if at least one part applies to you. A salaried office worker under 65 with no car loan on a new vehicle has nothing to enter and can skip it. For a summary of every change in the law, start with our [One Big Beautiful Bill tax changes](https://taxbracketsdesk.com/new-tax-law) hub.

| Part | Covers | Lines | Maximum |
| --- | --- | --- | --- |
| I | Modified AGI | 1 to 3 | Not a deduction |
| II | No tax on tips | 4 to 13 | $25,000 |
| III | No tax on overtime | 14 to 21 | $12,500 ($25,000 joint) |
| IV | Car loan interest | 22 to 30 | $10,000 |
| V | Enhanced deduction for seniors | 31 to 37 | $6,000 per person |
| VI | Total additional deductions | 38 | Sum of II to V |

The six parts of Schedule 1-A (lines from the 2025 form)

> **2026 version not yet released:** As of September 18, 2026, the IRS had not posted the 2026 Schedule 1-A used for returns filed in 2027. Line numbers here come from the 2025 form. The parts and limits are set by law through 2028, but check the final form at IRS.gov/Form1040 before you file.

## Who needs to file Schedule 1-A

You need the form if any of these applied to you during the tax year. The tips, overtime and senior parts each require a valid Social Security number and, for married people, a joint return.

- You received qualified tips in an occupation on the Treasury list of [tipped occupations](https://taxbracketsdesk.com/new-tax-law/tipped-occupations-list-deduction).
- You were paid overtime that the Fair Labor Standards Act required, and you were not an exempt employee.
- You paid interest on a loan taken out after December 31, 2024, to buy a new personal-use vehicle with final assembly in the United States.
- You, or your spouse on a joint return, were 65 or older by the end of the year. For 2026 that means born before January 2, 1962.

### Do I need Schedule 1-A if I itemize?

Yes, if you want these deductions. Itemizing on Schedule A does not replace Schedule 1-A; you file both. The only difference for older itemizers is that they lose the age 65 add-on to the standard deduction but keep the $6,000 senior amount.

## Part by part walkthrough of the Schedule 1-A additional deductions

### Part I: modified AGI (lines 1 to 3)

Line 1 is your AGI from Form 1040 line 11b. Lines 2a to 2d add back income you excluded from Puerto Rico, the foreign earned income and housing exclusions from Form 2555 lines 45 and 50, and American Samoa income from Form 4563 line 15. For most people, line 3 simply equals AGI. Every later part uses line 3 for its phaseout.

### Part II: no tax on tips (lines 4 to 13)

Employees enter qualified tips on line 4. On the 2025 form, line 4a uses tips in W-2 box 7 and line 4b uses tips reported on Form 4137. Self-employed tipped workers use line 5, capped at net profit from that business. Line 7 limits the total to $25,000, and lines 8 to 13 cut it by $100 for each full $1,000 of MAGI over $150,000 ($300,000 joint).

### Part III: no tax on overtime (lines 14 to 21)

Line 14a takes qualified overtime included in W-2 box 1, and line 14b takes qualified overtime paid to contractors on Form 1099-NEC or 1099-MISC. Line 15 applies the $12,500 or $25,000 joint cap. Lines 16 to 21 run the same $100 per $1,000 phaseout as the tips part, using the $150,000 or $300,000 thresholds. Only the premium part of time-and-a-half counts; our [overtime deduction calculator](https://taxbracketsdesk.com/new-tax-law/overtime-deduction-calculator) shows the math.

### Part IV: car loan interest (lines 22 to 30)

Line 22 asks for each vehicle's 17-character VIN, with room for two. Column (ii) is interest already deducted on Schedule C, E or F, and column (iii) is the rest. The cap is $10,000. The phaseout is steeper: $200 per $1,000 of MAGI over $100,000 ($200,000 joint), and a partial thousand is rounded up, not down. Rules on eligible vehicles are in our [car loan interest deduction](https://taxbracketsdesk.com/new-tax-law/car-loan-interest-deduction) guide.

### Part V: enhanced deduction for seniors (lines 31 to 37)

Lines 31 to 35 start from $6,000 and subtract 6% of MAGI above $75,000 ($150,000 joint). Line 36a is for you and line 36b for your spouse, each entered only if that person meets the age and SSN test. Line 37 adds them. How this interacts with the regular deduction is explained in [is the senior deduction on top of the standard deduction](https://taxbracketsdesk.com/new-tax-law/senior-deduction-plus-standard-deduction).

### Part VI: total (line 38)

Line 38 adds lines 13, 21, 30 and 37. That single figure is what moves to your Form 1040.

## Documents you will need for the Schedule 1-A form

Pull these together before you start. For 2026 returns, employers and payers report tips and overtime in new boxes, which our page on [W-2 codes TT and TP](https://taxbracketsdesk.com/new-tax-law/w2-codes-tips-overtime) explains.

> **Keep the paper trail:** The IRS can ask you to prove the overtime premium, tip amounts or the vehicle's assembly location. Keep pay stubs, tip logs and the loan contract with your return records.

## Where the total goes on Form 1040

The line 38 total goes on Form 1040 or 1040-SR line 13b, or 1040-NR line 13c. It is subtracted after adjusted gross income, alongside the standard or itemized deduction, to reach taxable income. Because it is below the AGI line, it does not change AGI-based figures such as the income test for taxing Social Security benefits.

### Full example: a two-income couple for 2026

A married couple filing jointly has MAGI of $168,000. She is a 41-year-old server with $9,200 of qualified tips. He is a 66-year-old machinist with $4,100 of overtime premium, and they paid $2,300 of interest on a new US-assembled pickup bought in 2025.

| Part | Calculation | Deduction |
| --- | --- | --- |
| II Tips | $9,200; MAGI under $300,000 | $9,200 |
| III Overtime | $4,100; MAGI under $300,000 | $4,100 |
| IV Car loan | $2,300; MAGI under $200,000 | $2,300 |
| V Senior (husband only) | $6,000 - 6% x $18,000 | $4,920 |
| VI Line 38 total | Sum of parts | $20,520 |

Schedule 1-A for the example couple

Their taxable income is MAGI of $168,000 minus the $33,850 standard deduction (including his $1,650 age add-on) minus $20,520, or $113,630. Without Schedule 1-A it would have been $134,150, all of the difference falling in the 22% bracket, a federal saving of $4,514.40.

## Common Form 1040 Schedule 1-A mistakes

- Entering total overtime pay instead of the premium part.
- Filing married filing separately, which blocks the tips, overtime and senior deductions.
- Claiming the senior deduction for a spouse who turns 65 after the year ends.
- Deducting interest on a used car, a lease, or a vehicle assembled outside the US.
- Using AGI after the deduction for the phaseouts instead of line 3.
- Counting tips earned in a job that is not on the Treasury tipped occupation list.

If you left a Schedule 1-A deduction off a return that has already been filed, you can amend it with Form 1040-X within the normal amendment window. Changes coming for the 2027 filing year are tracked on [tax changes 2027](https://taxbracketsdesk.com/new-tax-law/tax-changes-2027).

## Step by step

1. **Figure modified AGI.** Complete Part I using Form 1040 line 11b plus any excluded Puerto Rico, foreign or American Samoa income.
2. **Complete the tips part.** Enter qualified tips from your W-2, Form 4137 or 1099 forms in Part II, cap at $25,000 and apply the phaseout.
3. **Complete the overtime part.** Enter the FLSA overtime premium in Part III, cap at $12,500 or $25,000 joint and apply the phaseout.
4. **Complete the car loan part.** List the VIN and qualified interest in Part IV, cap at $10,000 and apply the $200 per $1,000 phaseout.
5. **Complete the senior part.** In Part V, reduce $6,000 by 6% of MAGI over the threshold and enter it for each person who qualifies.
6. **Total and transfer.** Add the four results on line 38 and enter the total on Form 1040 line 13b.

## Common questions

### What is Schedule 1-A on my tax return?

It is a two-page IRS schedule titled Additional Deductions that you attach to Form 1040 to claim the tips, overtime, car loan interest and senior deductions for 2025 through 2028.

### Which line of Schedule 1-A is for overtime?

Part III. On the 2025 form, qualified overtime goes on lines 14a and 14b, the capped amount on line 15, and the final overtime deduction on line 21.

### Where does the Schedule 1-A total go on Form 1040?

Line 38 of Schedule 1-A goes on Form 1040 or 1040-SR line 13b, or Form 1040-NR line 13c.

### Can I file Schedule 1-A with the standard deduction?

Yes. It works with both the standard deduction and itemized deductions, and you do not give up the standard deduction to use it.

### Does Schedule 1-A lower my AGI?

No. The total is subtracted after AGI, so AGI and anything calculated from it stay the same.

### Is Schedule 1-A the same as Schedule 1?

No. Schedule 1 reports additional income and adjustments that reduce AGI. Schedule 1-A holds only the four new deductions, which are taken after AGI.

## Sources

- [Schedule 1-A: what to know about the new form](https://www.irs.gov/newsroom/schedule-1-a-additional-deductions-what-to-know-about-the-new-form)
- [Schedule 1-A (Form 1040) 2025, Additional Deductions](https://www.irs.gov/pub/irs-pdf/f1040s1a.pdf)
- [Publication 505 (2026), Tax Withholding and Estimated Tax](https://www.irs.gov/pub/irs-pdf/p505.pdf)
- [One Big Beautiful Bill Act: tax deductions for working Americans and seniors](https://www.irs.gov/newsroom/one-big-beautiful-bill-act-tax-deductions-for-working-americans-and-seniors)
- [Rev. Proc. 2025-32, 2026 inflation adjustments](https://www.irs.gov/pub/irs-drop/rp-25-32.pdf)