Introduction
For US returns filed from Australia, "2026 taxes" can mean two things. A return filed in 2026 covers the 2025 tax year. A 2026 tax-year return gets filed in 2027.
This guide covers the first. The IRS opened the 2026 filing season on January 26, 2026, and the US federal deadline is April 15, 2026.
Seniors often struggle with small print and with matching the correct standard deduction on Form 1040.
Form 1040-SR is an optional return for older taxpayers. It has larger print and a built-in standard deduction chart. It is not a separate tax system or rate.
The sections below cover eligibility, how it compares with Form 1040, 2025 changes, the new senior deduction, and filing from Australia.
Key Takeaways
- If you were born before January 2, 1961, you can choose Form 1040-SR or Form 1040.
- Both forms use the same schedules and rules, so the form alone saves no tax.
- The new $6,000 senior deduction is separate from the age-based standard deduction add-on.
- A U.S. return does not replace your Australian return, FBAR or Form 8938 duties.
What Is Form 1040-SR and Who Can Use It?
Form 1040-SR is the "U.S. Tax Return for Seniors." It presents Form 1040 in a way that is easier to read on paper.
Who is eligible to use Form 1040-SR?
For the 2025 tax year, the IRS instructions say the form is available if you were born before January 2, 1961, meaning you turned 65 by the end of 2025.
- Retirement is not required. The test is age, not work status.
- Wages, pensions, Social Security and investment income do not affect eligibility.
- All five filing statuses appear on the form: single, married filing jointly, married filing separately, head of household and qualifying surviving spouse.
- The instructions phrase the age test as applying to "you." Married couples where only one spouse is 65 should confirm the rule in the current instructions.
What makes the form senior-friendly?
- Larger print and more spacing
- Separate age and blindness checkboxes for taxpayer and spouse
- A standard deduction chart on the form itself
What income can be reported?
The form has lines for common senior income sources:
- Wages, interest and dividends
- IRA distributions, pensions and annuities
- Social Security benefits and capital gains
Other income, including self-employment, flows through Schedule 1 and the usual schedules.
What the form does not change
Using 1040-SR does not change tax rates, taxable income rules or the need for supporting schedules. It also has no effect on your Australian tax obligations.
Always work from the current 2025 IRS form and instructions, not older versions.
Form 1040 vs. Form 1040-SR: What Is the Difference?
Both forms calculate income, deductions, taxable income, tax, payments, and refund or balance due. The IRS says Form 1040-SR uses the same schedules and instructions as Form 1040.
Which visual and practical features differ?
- Larger text and a more readable layout
- A standard deduction chart printed on the form
- Layout suited to paper returns completed by hand
Does Form 1040-SR provide a larger refund?
No. Your tax result is the same either way. The choice is about readability and convenience.
Software choice matters as well. The IRS Free File Fillable Forms page lists Form 1040, not Form 1040-SR, and that limit applies only to that tool. Check whether your software supports 1040-SR and review the final return for accuracy.
If you want help filing, VJM Global prepares U.S. Form 1040 returns for individuals.
What's New for the 2025 Tax Year Filed in 2026?
Comparing the 2024 and 2025 forms shows a few changes:
| Item | 2024 form | 2025 form |
|---|---|---|
| Digital-asset question | Covers 2024 activity | Covers 2025 activity (not a new question) |
| Withholding and estimated payments | Lines 25 and 26 | Same lines, updated to 2025 payments |
| Additional deductions | No line | New line 13b, carrying Schedule 1-A |
The new senior deduction
Public Law 119-21 (section 70103) adds an enhanced deduction for seniors under IRC section 151(d)(5)(C). It applies for 2025 through 2028.
- Up to $6,000 per qualifying person aged 65 or older; up to $12,000 on a joint return if both qualify
- Reduced by 6% of modified adjusted gross income above $75,000 (non-joint) or $150,000 (joint)
- Each claimant needs a valid Social Security number
- Married people must file jointly to claim it
- Calculated in Part V of Schedule 1-A, with the total on line 13b
- Available whether you itemise or take the standard deduction
Standard deduction for 2025
The age and blindness add-on is a separate benefit from the senior deduction. Here are the amounts from IRS Publication 501:
| Filing status | Basic amount | Add-on per age/blindness box |
|---|---|---|
| Single | $15,750 | $2,000 |
| Married filing jointly | $31,500 | $1,600 |
| Married filing separately | $15,750 | $1,600 |
| Head of household | $23,625 | $2,000 |
| Qualifying surviving spouse | $31,500 | $1,600 |
The form does not force you to take the standard deduction. If your itemised deductions exceed it, itemising may pay off. Tax legislation can change forms mid-cycle, so confirm figures against the current IRS instructions when you file your 2025 return.
How to Prepare and File Form 1040-SR From Australia
Work through this sequence:
- Confirm you are filing for tax year 2025.
- Confirm you meet the age test.
- Collect income records.
- Check which schedules apply.
- Review foreign tax issues.
- Choose paper or e-filing. Returns with a foreign address can be e-filed, per IRS Publication 54.
Deadlines: Taxpayers living abroad with a tax home outside the U.S. get an automatic extension to June 15, 2026. Interest on unpaid tax still runs from April 15. Form 4868 extends filing to October 15, 2026, but not payment. The IRS international mailing-address table covers 2025 filings, so confirm the current address before mailing.
What documents should seniors collect?
- Prior-year return and Social Security number or ITIN
- W-2s, 1099s, SSA-1099 and 1099-R forms
- Pension, annuity and investment statements
- Business records, charitable receipts and medical expense records
- Proof of tax payments
- Australian income statements, superannuation records, foreign tax paid and overseas account details
How should taxpayers report income earned in Australia?
U.S. citizens and resident aliens abroad owe U.S. tax on worldwide income. Report amounts in U.S. dollars, using the exchange rate when income is received or an expense is paid. Apply the method consistently.
Treaty rules matter. Under Article 18(2) of the U.S.-Australia treaty, as explained by Treasury, Social Security paid by one country to a resident of the other is taxable only by the paying country. Superannuation is less clear. A withdrawn 2006 IRS ruling request treated one fund payment as taxable, but that is not a rule for every fund. Get advice on yours.
How do foreign tax credits and exclusions fit in?
- Form 1116 claims a credit for eligible foreign income tax.
- Form 2555 excludes foreign earned income, meaning pay for services. Pensions, annuities and Social Security do not count.
- You cannot claim a credit for foreign tax on income you excluded.
Treat earned, investment and pension income separately rather than under one assumed rule.
What additional reporting may apply?
- FBAR (FinCEN Form 114): required if foreign accounts exceed $10,000 at any time in the year, per FinCEN
- Form 8938: for taxpayers abroad, thresholds start at $200,000 at year end or $300,000 at any time (unmarried), and $400,000 or $600,000 for joint filers
- State returns: check separately
Form 1040-SR is not an Australian return. The ATO says Australian tax residents must declare foreign income on their Australian return, and residency status decides which rules apply.
When should a taxpayer seek professional review?
Get help if your return involves:
- Australian pensions or superannuation
- Foreign investments or multiple currencies
- Business income
- Late or amended returns
- Foreign tax credits or overseas-account reporting
VJM Global offers cross-border tax and accounting support, including U.S. Form 1040 preparation and DTAA advisory, through a team of CPAs, Chartered Accountants and U.S.-compliant professionals.
Common Filing Situations and Mistakes to Avoid
The retiree. Typical income includes Social Security, an Australian pension or superannuation payment, investment income and perhaps a U.S. pension. Review the SSA-1099, 1099-R, investment statements and treaty treatment of each stream.
The working senior or business owner. Australian wages or self-employment income raise questions about Form 2555, Form 1116, business schedules and separate Australian filings.
These situations often lead to the same filing mistakes:
- Using the wrong tax-year form
- Assuming Form 1040-SR creates a tax benefit
- Overlooking the age test
- Confusing the age add-on with the new senior deduction
- Converting foreign income inconsistently
- Omitting overseas account reports
- Filing a correction as a new original return
Late filing compounds the problem. The failure-to-file penalty is 5% of unpaid tax per month, up to 25%.
If you find an error, use Form 1040-X, one per tax year. It can be e-filed for current and two prior years, but a paper original requires a paper amendment.
Frequently Asked Questions
What is IRS Form 1040-SR?
It is an optional large-print federal income tax return for eligible older taxpayers. It generally follows the same tax rules as Form 1040.
What is the difference between Form 1040 and Form 1040-SR?
The differences are layout, readability and the built-in standard deduction chart. The tax calculation is the same.
What are the instructions for filing Form 1040-SR for the 2025 tax year?
Use the current IRS instructions for Form 1040, which cover both forms. Confirm eligibility, gather income documents, add schedules and choose a filing method.
What's new on Form 1040-SR for 2025?
The main addition is line 13b, which carries additional deductions from Schedule 1-A. Also check the 2025 withholding and estimated-payment lines and the deduction chart.
What is the new $6,000 tax deduction for seniors in 2025 and how do I claim it?
Qualifying people 65 or older can deduct up to $6,000, phased out above $75,000 of MAGI ($150,000 joint). Complete Part V of Schedule 1-A and carry the total to line 13b.
What is the standard deduction for Form 1040-SR in 2025?
It is $15,750 for single filers, $31,500 for joint filers and $23,625 for heads of household. Each age or blindness box adds $1,600 or $2,000, depending on filing status.
