Choosing Between ITR-1 and ITR-2 Isn’t Always Obvious

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For most salaried individuals, tax filing seems like a straightforward task, until they log in and realize there are multiple ITR forms. The confusion between ITR-1 and ITR-2 is one of the most common dilemmas. Both cater to individual taxpayers, but the scope of income types, asset ownership, and residency status make the decision tricky. Even a small investment in foreign stocks or a second house can push you into the ITR-2 category without you realizing it.

Understanding this nuance is critical because selecting the wrong form may result in notices, return rejection, or missed reporting requirements. Many filers default to ITR-1 because it looks simpler. But simplicity doesn’t always mean accuracy. It’s not about convenience; it’s about eligibility. Whether you earn interest income, dividends, rent, or capital gains, all of it affects your ITR choice.

To avoid complications during assessments or refunds, always cross-check your income types with the form descriptions. And if you’re still in doubt, this comparison guide will help you decide which form fits you best: ITR-1 vs. ITR-2.

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