Schedule 1 (Form 1040) is the IRS schedule for income and deductions that can't go straight onto Form 1040, 1040-SR or 1040-NR. Part I adds income such as business profit, unemployment pay, gambling winnings and canceled debt, and its total goes to Form 1040 line 8. Part II lists adjustments such as the HSA, IRA and student loan interest deductions, and its total goes to line 10.
This is the tax form, not the video game of the same name. Everything below follows the 2025 Schedule 1 and the IRS instructions for it, as of October 2026, so it applies to the return you file for tax year 2025.
When you need Schedule 1
Form 1040 has room for wages, interest, dividends, pensions, Social Security and capital gains. Anything else that's taxable, and most deductions you take before the standard deduction, runs through Schedule 1. If none of its lines apply to you, you don't attach it.
Its siblings handle other jobs. Schedule 2 is for extra taxes such as self-employment tax, and Schedule 3 is for extra credits and payments. For 2025 there's also a new Schedule 1-A for the deductions for qualified tips, qualified overtime, qualified car loan interest and the enhanced deduction for seniors. Those don't go on Schedule 1 itself.
The box at the top for Form 1099-K mistakes
Before Part I there's an entry space for Form 1099-K amounts that were included in error, such as gifts or reimbursements, or that came from personal items you sold at a loss. The IRS example: you bought a couch for $1,000 and sold it for $700, so you enter $700 there. A personal item sold at a gain isn't entered in that box. It's a capital gain for Form 8949 and Schedule D.
For 2025, payment card companies, payment apps and online selling platforms only have to send a 1099-K when your business transactions are over $20,000 and there are more than 200 of them.
Part I: additional income, line by line
| Line | What goes there |
|---|---|
| 1 | Taxable refunds, credits or offsets of state and local income tax, only if you itemized when you paid the tax |
| 2a and 2b | Alimony received under an agreement made on or before December 31, 2018, plus the agreement's month and year |
| 3 | Business income or loss, from Schedule C |
| 4 | Other gains or losses, from Form 4797 or Form 4684 |
| 5 | Rents, royalties, partnerships, S corporations and trusts, from Schedule E |
| 6 | Farm income or loss, from Schedule F |
| 7 | Unemployment compensation, from Form 1099-G box 1 |
| 8a to 8z | Other income, from a net operating loss to digital assets |
| 10 | Total additional income, carried to Form 1040 line 8 |
The other income lines people miss
Line 8 runs from 8a to 8z, and it's where most surprises sit. Gambling winnings that aren't from a trade or business go on 8b, and that includes lotteries and raffles. Canceled debt goes on 8c, though part or all of it may be nontaxable. Jury duty pay goes on 8h, and if you handed it to your employer because they kept paying your salary, you deduct it again on line 24a. Prizes and awards go on 8i.
Line 8v is for ordinary income from digital assets that isn't reported anywhere else, such as staking or mining income. Don't put a gift or inheritance of digital assets there. The instructions also warn that self-employment income and nonemployee pay from Form 1099-NEC don't belong on line 8 at all. They go on Schedule C, even if you had no expenses.
Part II: adjustments to income
Part II is a list of deductions you can take whether or not you itemize. Its total, on line 26, goes to Form 1040 line 10 and lowers your adjusted gross income.
- Line 11, educator expenses: up to $300 for an eligible educator, or $600 if both spouses on a joint return qualify.
- Line 13, HSA deduction: your own contributions, from Form 8889.
- Line 15, the deductible part of self-employment tax, from Schedule SE line 13.
- Lines 16 and 17: self-employed retirement plan contributions and self-employed health insurance.
- Line 18: the penalty a bank charged for early withdrawal of savings, shown on Form 1099-INT or 1099-OID.
- Line 20, IRA deduction: you can deduct traditional IRA contributions regardless of age.
- Line 21, student loan interest: up to $2,500, if you're not married filing separately and your income is under the limits.
- Line 22 is reserved for future use, so leave it blank.
Two rules that trip people up
Alimony works both ways on this form. You report it as income on line 2a, and deduct it on line 19a, only for divorce or separation agreements made on or before December 31, 2018. Agreements made after that date don't count, and nor do older ones changed after it to say so expressly.
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The student loan interest deduction has a hard income cap. For 2025 your modified adjusted gross income has to be under $100,000 if you're single, head of household or a qualifying surviving spouse, and under $200,000 if you're married filing jointly. Your lender's Form 1098-E shows the interest you paid.
The verdict
If you had any income that isn't wages, interest, dividends, pensions or gains, or you want an HSA, IRA or student loan interest deduction, you'll fill in Schedule 1. Work through Part I first, check line 8's list carefully, then take every Part II adjustment you're entitled to. Two totals leave the schedule: line 10 to Form 1040 line 8 and line 26 to line 10.
Frequently asked questions
What is Schedule 1 on a tax return?
It's the Form 1040 schedule for additional income and adjustments to income that can't be entered directly on Form 1040, 1040-SR or 1040-NR.
Who has to file Schedule 1?
Anyone with income such as business, rental, unemployment or gambling income, or anyone claiming an adjustment such as the HSA, IRA or student loan interest deduction.
Where does the Schedule 1 total go?
Line 10 goes to Form 1040, 1040-SR or 1040-NR line 8, and line 26 goes to line 10.
Is Schedule 1-A the same as Schedule 1?
No. Schedule 1-A is the separate 2025 schedule for the tips, overtime, car loan interest and enhanced senior deductions.
What's the student loan interest limit on Schedule 1?
As of October 2026, for 2025 returns it's up to $2,500, with the modified AGI limits of $100,000, or $200,000 for joint filers.
