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entris posted:Speaking of CP2000 notices, I have a client who just got one with a proposed balance due of $1.5 million. Speaking as a tax preparer, 95% of the time when the client gets one of these notices it's because they neglected to get info to me. The other 5% is the IRS trying to get taxable home gains, even though they tell us not to report the sale anyways.
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Aug 27, 2012 16:45
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entris posted:Speaking of CP2000 notices, I have a client who just got one with a proposed balance due of $1.5 million. I freaked out a bit when I got one a couple months ago saying I owed $9k (until I realized that it was assuming a basis of $0); $1.5M would have probably killed me before I realized. Also, pro tax tip: if you print your online 1099-DIV's and 1099-B's double-sided to save paper, don't move that form to the "handled" pile until you've done both sides. 
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Aug 27, 2012 17:22
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AbbiTheDog posted:Speaking as a tax preparer, 95% of the time when the client gets one of these notices it's because they neglected to get info to me. Yeah, that wasn't the issue here - the tax preparer in question is a large multi-national organization, and it looks like one of its overseas subsidiaries did a bunch of sales which the home office failed to include on the return. We had just become aware of this omission a few weeks ago, and were already trying to locate all the basis information for the sale, when the CP2000 came in the mail. Hahaha good thing we were already on top of the issue, or we would have been screwed trying to find all of the information in time.
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Aug 27, 2012 17:56
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entris posted:Yeah, that wasn't the issue here - the tax preparer in question is a large multi-national organization, and it looks like one of its overseas subsidiaries did a bunch of sales which the home office failed to include on the return. We had just become aware of this omission a few weeks ago, and were already trying to locate all the basis information for the sale, when the CP2000 came in the mail. Hahaha good thing we were already on top of the issue, or we would have been screwed trying to find all of the information in time. Eh, if you called them and asked for more time they would give it to you.
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Aug 27, 2012 18:39
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Admiral101 posted:A side project? Was it created using company resources? Or is this something you did on the side privately? Did this project cost you any money personally? Ok, so an update to this. My employer went ahead and classified it as a "Bonus", boosting my monthly from $6700 to $7700 this month. My take home went from $4583 to $5189...meaning my theoretical $1000 bonus really turned out to be $606. I guess I'm just a bit shocked that I lost $400 in taxes. 
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Sep 1, 2012 06:10
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I haven't been in here for quite some time but I have an issue and I am about to freak out. I just received a 1099-misc in the amount of $30,000 from my old "friend" who I did some webmaster work with a few years ago. The 1099 says 2010 on it which was around the time we worked together for about two months. The amount on the 1099 ($30,000) is completely fabricated, he paid me fractions of that, in cash, so there is no way he has any sort of paystubs or anything for that, unless he is falsifying those as well. What can I do? Back when we were friends he told me in detail how he had been working for several websites as an affiliate and hadn't paid his taxes in years, he just received 1099's from those companies and threw them in the garbage. I imagine this has now caught up with him and he is trying to come up with any way possible to shift some of the tax burden off of himself. [Removed] To be clear, I am not trying to screw the IRS, but he did not pay me that amount. It is completely false. Bojanglesworth fucked around with this message at 04:25 on Sep 14, 2012 |
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Sep 1, 2012 17:00
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http://www.ehow.com/how_5095636_dispute-erroneous-irs-form.html
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Sep 2, 2012 02:43
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Admiral101 posted:Under what circumstances would he be able to report this as anything except self employment income? Since he personally built this project, it seems pretty textbook. Sorry I am just jumping back in. I was wondering if there was anything else, customer lists for example, that MIGHT be classified as a cap gain asset. Very doubtful I know, was just stretching.
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Sep 3, 2012 05:04
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polyfractal posted:Ok, so an update to this. My employer went ahead and classified it as a "Bonus", boosting my monthly from $6700 to $7700 this month. My take home went from $4583 to $5189...meaning my theoretical $1000 bonus really turned out to be $606.
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Sep 3, 2012 19:59
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Bojanglesworth posted:I haven't been in here for quite some time but I have an issue and I am about to freak out. The ehow link that someone posted earlier is a good start, but here are a few other thougths: 1. "Throwing a 1099 in the garbage" is generally a bad idea. Just like a W-2, the person issuing these to you has to also send them to the IRS. The IRS then compares what they received from the issuer to what you declared on your taxes. Any discrepancy will likely trigger an inquiry from them to you, which you will need to respond to. So don't ignore this. 2. Businesses need to file their 1099's with the IRS by March 31 of the following year; 3/31/2011 in your case. So if you just received this, your "friend" is very late and got to pay the IRS a nice $100 penalty. This is in your favor, read on. 3. From what you have mentioned about your friend, it sounds like he's gettting around to finally filing his 2010 taxes and probably needs to claim some additional "deductions" to reduce his taxable income and not get raped by the IRS. So he decided to claim that he paid you $30,000, which in theory the IRS could now ask you for. 4. To protect yourself, I would suggest you write to your "friend" using some sort of proof of delivery method (certified mail, FedEx, etc.) pointing out that the 1099 was issued in error and demanding that it be corrected. Keep a copy for when the IRS comes asking you about it. Also, contact the IRS as pointed out in the ehow link and dispute this 1099 with them. Bringing things to their attention before they bring it to yours goes a long way when dealing with these guys. 5. Finally, depending on just how many hundreds of dollars cash your "friend" paid you, you might want to consider re-filing 2010 and declaring those dollars. That way your situation is squeeky clean for when the IRS comes asking. Which unfortunately they are VERY liklely to do for this sort of thing. Hope that helps.
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Sep 4, 2012 00:14
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Just want to be sure, before I finally rent an apartment, if I live in New Jersey, I don't have to pay NYC city tax, correct?
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Sep 4, 2012 07:49
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Napoleon I posted:Just want to be sure, before I finally rent an apartment, if I live in New Jersey, I don't have to pay NYC city tax, correct? Not a tax pro, just a Jersey resident. You do have to pay any NYC wage taxes but you can claim them as a credit on your NJ tax return. http://www.state.nj.us/treasury/taxation/njit14.shtml
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Sep 4, 2012 08:29
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fordan posted:Not a tax pro, just a Jersey resident. You do have to pay any NYC wage taxes but you can claim them as a credit on your NJ tax return.
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Sep 4, 2012 09:10
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Small White Dragon posted:I've been told by some colleagues in the area that New York City's income tax is only levied upon its own residents, and not upon those who work in the city but live elsewhere. That's correct. If you live in NJ and commute into the city, you DO NOT need to pay NYC income tax. Make sure you tell your employer that you moved so that they adjust your witholding accordingly. You will of course still have to pay New York State income tax on your employment income since that is earned in NYS. You will get a credit for the taxes paid on that on your NJ State return. Hope that helps.
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Sep 4, 2012 14:50
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Oliax posted:The ehow link that someone posted earlier is a good start, but here are a few other thougths: Other notes - how did he pay you? Did you deposit or cash the checks? If he claims to have paid you this amount, ask for copies of the checks that cleared. And the amount of balls he has are amazing. Same with his level of stupidity.
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Sep 4, 2012 17:05
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Oliax posted:That's correct. If you live in NJ and commute into the city, you DO NOT need to pay NYC income tax. Make sure you tell your employer that you moved so that they adjust your witholding accordingly. You will of course still have to pay New York State income tax on your employment income since that is earned in NYS. You will get a credit for the taxes paid on that on your NJ State return. Great, thanks. I've been having a horrible time getting a definitive answer on this (everything I've found has been about rich people with a place in the city living there 184 days or w/e and getting in trouble). About the state taxes: Is the NJ credit refundable? E.g., if I pay $8,000 in NYS taxes, but I'd only owe $6,000 in NJS taxes, would they cut me a check for $2,000, or would I just owe $0 to NJ but would still be on the hook for the extra $2,000 to NY? e: vvv Thanks! Napoleon I fucked around with this message at 19:42 on Sep 4, 2012 |
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Sep 4, 2012 19:23
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Napoleon I posted:Great, thanks. I've been having a horrible time getting a definitive answer on this (everything I've found has been about rich people with a place in the city living there 184 days or w/e and getting in trouble). Option B
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Sep 4, 2012 19:25
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furushotakeru posted:Option B That unfortunately is the downside of working in a higher tax state.
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Sep 4, 2012 20:06
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AbbiTheDog posted:Other notes - how did he pay you? Did you deposit or cash the checks? /agree re his stupidity. Hypothetically, if he had wanted to make up fake expenses he should have pretended to have paid them to a corporation or other entity to whom he would not have been obligated to issue a 1099. Good news is that your "friend" is likely to get into some major trouble here. Just amke sure your paperwork is clean and it shouldn't affect you.
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Sep 4, 2012 20:23
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I think you guys are looking at this all wrong. Bojanglesworth is clearly owed the difference between $30,000 and what he was actually paid. I think he should confront his friend and demand for the rest of the money.
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Sep 4, 2012 21:07
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Oliax posted:/agree re his stupidity. Hypothetically, if he had wanted to make up fake expenses he should have pretended to have paid them to a corporation or other entity to whom he would not have been obligated to issue a 1099. "I paid $599 cash to a large number of contracted code monkeys. No 1099 required."
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Sep 4, 2012 22:57
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entris posted:I think you guys are looking at this all wrong. Bojanglesworth is clearly owed the difference between $30,000 and what he was actually paid. I think he should confront his friend and demand for the rest of the money. He'd only owe whatever he actually constructively received back in 2010 and the rest would be taxable this year if he was actually successfully in getting paid the balance, so he'd still need to get that Form 1099-MISC corrected. But if he does need 'help' on getting owed the difference, I do know some 'friends' that can assist him with his 'friend' problem...  
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Sep 5, 2012 04:29
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AbbiTheDog posted:Other notes - how did he pay you? Did you deposit or cash the checks? I gave him a ride to the bank and he handed me cash. Never even a single time did a check exchange hands. edit: I didn't claim any of the money on my 2010 taxes (I know, I know) because he just handed me cash when I helped him out.
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Sep 7, 2012 23:43
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Bojanglesworth posted:edit: I didn't claim any of the money on my 2010 taxes (I know, I know) because he just handed me cash when I helped him out. does IRS even send matching notices for prior-year 1099s? obviously "do nothing" is a pretty bad strategy for OP, but I wonder how long he'd have before anybody even noticed.
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Sep 8, 2012 01:17
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I'm a resident of Pennsylvania and live in Philadelphia. I sell things on Amazon and get a 1099k at the end of the year. last year my 1099k was 177,xxx. this year is much better and I project around double that. this figure, of course does not include COGS or any other expenses. what is my best bet strategically for my taxes, incorporate or not?
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Sep 8, 2012 15:19
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scribe jones posted:ah, there it is. I didn't claim anything because it was never treated as a job and not a whole lot of money. When his "business" came crashing down in 2010 he tried to get my social off of me with the intent of doing what he is doing now I assume. He is super sketchy and I knew he would try something like this so I told him no.
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Sep 8, 2012 17:21
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It's funny how you act like you aren't sketchy at all and he's just is slimeball. After all, you did cheat on your taxes.
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Sep 8, 2012 17:47
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furushotakeru posted:It's funny how you act like you aren't sketchy at all and he's just is slimeball. After all, you did cheat on your taxes. I'm No tax professional but not claiming a couple of grand seems a little different than making a completely false 1099 for $30,000 to shift the tax burden off of yourself.
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Sep 8, 2012 19:32
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positech posted:I'm a resident of Pennsylvania and live in Philadelphia. I sell things on Amazon and get a 1099k at the end of the year. last year my 1099k was 177,xxx. this year is much better and I project around double that. this figure, of course does not include COGS or any other expenses. What are you currently doing to report income? What profit do you make? Making an S-Corp would help reduce your self employment liabilities. It'll also spare you a portion of Philadelpia local tax. But you'll also be subject to Philadelphia Business Privilege Tax. It'll also increase your filing requirements and record keeping burdens. Where are you getting your inventory to sell on amazon? You may have sales/use tax concerns as well.
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Sep 9, 2012 00:04
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Bojanglesworth posted:I'm No tax professional but not claiming a couple of grand seems a little different than making a completely false 1099 for $30,000 to shift the tax burden off of yourself. How much money did he actually give you and what did you do with it? Now that he has sent a 1099,doing nothing is a really bad idea. You're likely to be better off coming clean like I mentioned in my earlier post and just paying tax on it. If it was only "a few thousand" it would not be that big of a penalty. But if you wait until the IRS comes knocking you run the risk of them wondering where the whole $30,000 went. Oliax fucked around with this message at 02:46 on Sep 9, 2012 |
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Sep 9, 2012 02:25
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Admiral101 posted:What are you currently doing to report income? What profit do you make? I have no employees, just myself. I buy everything retail and pay sales tax on it- I get inventory from several states and travel 3-5 days a week to pick it up. After counting COGs, travel, etc. I am probably looking at around 100-150k of gross profit that I will need to report. My 1099k will likely show something to the tune of 300k I am just kind of scared shitless that my 1099k will come, say I made 300k and I'll be liable for taxes on all of it. I can easily show that I sold a specific item for $25, received about $19 after fees, and paid $8 for it, netting $11 profit.
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Sep 9, 2012 04:33
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Seriously, gently caress Philadelphia's city tax so hard. It is the most confusing piece of poo poo bureacuracy I have ever encountered, mostly because they have a different form for every little thing and the instructions suck.
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Sep 9, 2012 05:16
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positech posted:I have no employees, just myself. I buy everything retail and pay sales tax on it- I get inventory from several states and travel 3-5 days a week to pick it up. After counting COGs, travel, etc. I am probably looking at around 100-150k of gross profit that I will need to report. My 1099k will likely show something to the tune of 300k Are you maintaining any kind of set of books? Or do you have some kind of gigantic shoebox full of receipts? You need to familiarize yourself with some kind of book keeping software, because you're dealing with non trivial numbers. There are entire threads that discuss which software is best, but in my experience quickbooks can do the most/is most common. You should also be tracking your mileage for picking up this inventory, assuming you use a personal vehicle as opposed to renting a U-Haul. I'm going to go ahead and say it makes sense for you to set up an S-Corp/file for an EIN. There are a lot of places online that can set it up for you relatively cheaply. The most immediate tax benefit to being an S-Corp is that S-Corp earnings aren't subject to self employment tax. You'll still need to take a wage, but it'll still be a significant reduction if you're pulling in 100-150k gross profit. If you have more questions about setting up a PA S-Corp, I can likely answer by virtue of also living in PA. quote:Seriously, gently caress Philadelphia's city tax so hard. It is the most confusing piece of poo poo bureacuracy I have ever encountered, mostly because they have a different form for every little thing and the instructions suck. It doesn't help that Philadelphia income taxes work absolutely nothing like the rest of the state. Including Pittsburgh/Erie.
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Sep 9, 2012 15:19
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Admiral101 posted:Are you maintaining any kind of set of books? Or do you have some kind of gigantic shoebox full of receipts? You need to familiarize yourself with some kind of book keeping software, because you're dealing with non trivial numbers. There are entire threads that discuss which software is best, but in my experience quickbooks can do the most/is most common. You should also be tracking your mileage for picking up this inventory, assuming you use a personal vehicle as opposed to renting a U-Haul. Oh good you're actually a PA CPA. Next time a Philly goon asks for my help I will send them to you. The fee isn't worth the time and headache involved.
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Sep 9, 2012 19:13
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1099 and business deduction question. Single filer. I have a full time job, but also had a part-time job. They paid me as an independent contractor. Probably legit classification. I did all my work outside of the office, either in client's homes or some at my own house. However, this job involved a ton of driving and they were paying me per mile reimbursement. Enough of my job involved driving that probably 1/3 of what they gave me is reimbursement for mileage. Something like $4000 out of $14000. However, it looks like I can only deduct this if I itemize? I don't own a home, so I don't think itemization can make sense for me. I've got student loan interest, and bought my own health care that year. It's not all that much. Turbotax at least just recommends I take the standard deduction. Not sure what else I've got, but it looks like I'm gonna get raped on this. And I'd really like to not get raped. I wasn't thinking that money I was getting to reimburse actual, mandatory, costs were something I would end up getting taxed on.
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Sep 10, 2012 20:50
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Kase Im Licht posted:1099 and business deduction question. Single filer. You can itemize business deductions against business income. This is independent from whether you are utilizing the standard or itemized deductions. And for what it is worth if you were reimbursed based on mileage logs you had to submit they should not have included those amounts on the 1099, but almost no one does that right. furushotakeru fucked around with this message at 21:47 on Sep 10, 2012 |
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Sep 10, 2012 21:32
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I have a question about donating a car. KBB says my car is worth about $750, NADA says $350. So assuming I donate the car and take the maximum $500 for it how does that affect my taxes? Will I get a full $500 back or will it be some fraction there of? Or would I be better off selling the car for scrap? I can get $300 in cash if it goes to the scrap yard but if I can get more through going the tax route I will.
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Sep 10, 2012 21:47
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Farside posted:So assuming I donate the car and take the maximum $500 for it how does that affect my taxes? Will I get a full $500 back or will it be some fraction there of? Note that there are some factors to consider. If you don't itemize, the donation may be useless for you for tax purposes. (Disclaimer: I am not a CPA, EA, RTRP or what have you.)
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Sep 10, 2012 21:58
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furushotakeru posted:You can itemize business deductions against business income. This is independent from whether you are utilizing the standard or itemized deductions. And for what it is worth if you were reimbursed based on mileage logs you had to submit they should not have included those amounts on the 1099, but almost no one does that right. From what I can tell, Turbotax does not seem to be deducting them against the income, since adding in that info does not seem to change my taxes owed. But I assume this is something they should be capable of doing so I'm probably just doing something wrong.
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Sep 10, 2012 21:59
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furushotakeru posted:Oh good you're actually a PA CPA. Next time a Philly goon asks for my help I will send them to you. The fee isn't worth the time and headache involved. I can't decide if this is a good thing or not. Farside posted:I have a question about donating a car. KBB says my car is worth about $750, NADA says $350. You're going to be better off financially selling it for scrap. Of course, some poor person somewhere gets screwed out of getting your free car. So the question becomes: how cold and frozen is your heart? Kase Im Licht posted:Yeah I submitted mileage logs but they definitely did not exclude those amounts. Kind of a small operation. The 1099 is actually filled out by hand. Turbotax should be reporting your business income on a schedule C. Is this happening? Where is turbotax reporting your income?
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Sep 11, 2012 01:04
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