Rounding Guidelines

IRS guidelines for rounding amounts to whole dollars on a return

In 1120, 1120-S, 1065, 1040, and 1041 returns, the IRS states that you can choose to round off cents to whole dollars on the return and schedules. 990 instructions detail that the organization must round off cents to whole dollars on the returns and schedules, unless otherwise noted for particular questions.

For all return types, both of the following rounding rules apply:

• Amounts under 50 cents round to zero. Increase amounts from 50 to 99 cents to the next dollar.

  • For example, $1.49 becomes $1 and $2.50 becomes $3.

• If two or more amounts must be added to figure the amount to enter on a line, include cents when adding the amounts and round off only the total.

In Drake Tax, there is no option regarding rounding in setup. All amounts will be rounded to the whole dollar to conform with IRS e-file guidelines.