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I'm trying to understand the AMT and the implications it has: am I correct that it's effectively a 28% flat tax on all income rather that completely ignores the marginal brackets?
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Dec 28, 2012 14:59
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AMT has a 26% and 28% bracket. That is all. It essentially takes your AGI, then only permits certain deductions (like charitable contributions). Other deductions, like real estate/state income taxes, are not permitted. There could be other adjustments as well regarding depreciation calculations etc. After these adjustments are made, you have your "alternative minimum taxable income". A big exemption is then shaved off this AMT income number. This exemption is what eliminates low income people from AMT. The remainder of the AMT income after this exemption is then subject to the 26%/28% rates. If the AMT tax is in excess of your regular income tax, then you will have to report the excess on line 45 of your 1040. Admiral101 fucked around with this message at 18:22 on Dec 28, 2012 |
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Dec 28, 2012 18:19
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Question for Furu regarding CA minimum tax: Have an OR based corp that did business in CA up until 2008 or so, at which point they told the state to make them inactive. Fast forward to 2013, and they are about to start doing business in CA again, and CA wants the $800 minimum for 2009 - 2012 to make the business "active" again. Is that how your state works? If so, you guys suck. Just seeing if you know off the top of your head before I spend a couple hours looking it up.
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Dec 28, 2012 19:45
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Admiral101 posted:AMT has a 26% and 28% bracket. That is all. You still have the 15% capital gains rate though. As you work through the phaseout for AMT your effective rate is actually 35%. Some credits also do not apply to AMT that reduce regular taxes.
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Dec 28, 2012 19:46
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AbbiTheDog posted:Question for Furu regarding CA minimum tax: No I don't know, but I agree that sounds asinine. Which means it probably actually is the way they work.
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Dec 28, 2012 19:47
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IRA question: On irs.gov it says that your IRA contribution is fully or partially deductible based on whether or not you've covered by a retirement plan at work. What if you're covered but have not vested yet? Thanks.
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Dec 29, 2012 04:08
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I'm currently working at a college internship and I am being paid a Stipend 2.5k a month. The company that is paying me does not report my earnings to the IRS. So I was wondering if I should just not file it in my taxes this year. It is a 6 month internship so I will be earning around 15k. Do you think I could get away with it?
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Dec 29, 2012 05:12
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lemoz posted:I'm currently working at a college internship and I am being paid a Stipend 2.5k a month. The company that is paying me does not report my earnings to the IRS. So I was wondering if I should just not file it in my taxes this year. It is a 6 month internship so I will be earning around 15k. Do you think I could get away with it? quote:What this thread is NOT for
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Dec 29, 2012 23:29
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socketwrencher posted:IRA question: On irs.gov it says that your IRA contribution is fully or partially deductible based on whether or not you've covered by a retirement plan at work. What if you're covered but have not vested yet? Thanks. You're covered. The particular vesting schedule of your employer's plan doesn't affect that distinction (nor does whether the company even provides a match).
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Dec 29, 2012 23:45
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catman posted:You're covered. The particular vesting schedule of your employer's plan doesn't affect that distinction (nor does whether the company even provides a match). Thanks catman. Makes sense.
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Dec 30, 2012 05:56
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My father wants to take some money out of his retirement account to remodel his house. It's not a huge pile; maybe a couple thousand, but he's worried about the myriad of taxes going up on the first. To save the most money in taxes, should he take the money out on the 31st, the first, or does it matter? He's just been calling me up worried.
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Dec 30, 2012 13:48
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IRA question. My employer has a simple IRA in which he matches our contributions. Including his matching, I have deposited just about the limits for 2012. This account is less than 2 years old, so I can't roll it into a Roth without a big penalty. I would like, however, to put money in My Roth for 2012. Can I simply put $5K from my checking account into the Roth and then not take a deduction for the simple IRA contributions I have already made? My gut says no, but I thought I would ask. Thank you all for your wisdom.
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Dec 30, 2012 15:21
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Spiro Agnew posted:IRA question. My employer has a simple IRA in which he matches our contributions. Including his matching, I have deposited just about the limits for 2012. This account is less than 2 years old, so I can't roll it into a Roth without a big penalty. Disclaimer: Not a CPA, EA, or anything of that sort, just someone who is in a similar situation.
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Dec 31, 2012 16:39
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I am attempting to see if I can comprehend my taxes enough to do them without spending a ton on a CPA for the 2012 tax year, so I tried to tackle what I believe to be the most difficult part of my taxes since I already have all the info needed for that part...or so I thought. I just moved across the country for work, and rented out my condo...and I figured the rental "income" section would be the most difficult so here is where I am lost... In Turbotax after I clicked through a few simple informative screens in the rental section, you come to a bunch of options to check off all that apply..now I know I definitely select "new rental this year" but then there's an option that has "converted from personal use to rental this year" that is throwing me off a ton. If I do not select this conversion option, everything seems to make sense, and I enter the days it was used as a rental and the days it was used as personal use on the next page, and the proper portion of mortgage interest and taxes are separated out for the days I used it as my main home and there are no "notes" that Turbotax likes to add at the end of certain sections. However, if I do select this conversion option, on the next page it has a "note" that says 'do not enter days you lived in the home prior to renting it as personal use days,' so I only enter the days it was rented, and then put 0 for personal use according to this. So the next page asks a bunch of questions about my original purchase and the FMV of the home and stuff to determine depreciation (which was not asked at all in the first scenario), also, with this option selected, it does not portion out the interest and taxes I paid while living there as my main home for the first half of the year, it does not deduct anything for the time I lived there as my main home. So, which option(s) do I select, and which scenario is correct? I moved for work and I owe more than the house is worth so I did the reasonable thing and signed a two year lease that started July 1, 2012. I do not plan on being in the rental business and will sell this ASAP, hopefully next year or definitely when the lease is over so I do not understand if I am suppose to check the box "converted from personal use to rental" as this seems to not deduct any of my mortgage expenses since it guides me to enter "0" for personal use days. I looked at the IRS publication for rentals which confused me even more so I am at a loss and considering spending the $800 to have a professional do it for me even though I cannot afford it...
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Dec 31, 2012 16:45
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SnatchRabbit posted:I looked at the IRS publication for rentals which confused me even more so Shouldn't run you $800. If you're confused, call around and get quotes.
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Dec 31, 2012 17:55
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Hell my CPA is 75 an hour. If he ran up an $800 bill, he'd have some explaining to do.
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Jan 1, 2013 00:44
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Long shot federal income question... Could a non-resident alien under an F1 student visa, who's working in the US as a research assistant claim a Professor/Teacher tax-treaty exemption for his income from his public university research job? I've had a CPA tell me yes last year but the verbiage that I've been seeing on various IRS documents is so convoluted and gives a broad definition of the professor's/researcher's "job description" is. A research assistant's job would fall under what's described in Publication 519 for instance.
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Jan 1, 2013 06:11
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I worked for a company in Kentucky from 1/17/11 - 8/25/11. Did I pay taxes for my earnings, for the entire duration of this time period, in my 2011 return? I've always paid using the default pay period, which I assume runs from 1-1-XX until 12-31-XX. I just want to make sure that I shouldn't be expecting another W-2 from them. I have moved since then. Also, has the American Opportunity Credit been extended for another year so that I can take advantage of it in my 2012 taxes? Will I be able to use the Kentucky Education Tuition Tax Credit? Those have really helped keep me afloat during the past year of college. OpusD fucked around with this message at 03:09 on Jan 2, 2013 |
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Jan 2, 2013 03:02
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On top of my salary this year, I have been dabbling in sports collectibles. I understand that paypal will be reporting this income, as it is past the 200 transactions limit. I realize that I will need to report this as income, as well as being able to deduct the expenses for it (right? ), but how do I record this for tax purposes? I have the pp statements and receipts for other purchases to be deducted, but this is all new to me. Is there another form to file? Can I still file electronically?
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Jan 2, 2013 03:28
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CraigK posted:My father wants to take some money out of his retirement account to remodel his house. It's not a huge pile; maybe a couple thousand, but he's worried about the myriad of taxes going up on the first. To save the most money in taxes, should he take the money out on the 31st, the first, or does it matter? He's just been calling me up worried. This is a late response, but all things being equal it should not matter.
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Jan 2, 2013 03:46
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shodanjr_gr posted:Long shot federal income question... I looked at a similar issue on behalf of a relative of a client last year and I am pretty sure that the answer is yes. Some helpful info:http://www.irs.gov/publications/p519/ch09.html
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Jan 2, 2013 03:54
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seymore posted:I looked at a similar issue on behalf of a relative of a client last year and I am pretty sure that the answer is yes. Thanks for this. The "teacher/professor/researcher" part of P519 seems so broad that even a researcher could be covered under the "teaching" clause. I claimed this last year and my refund went through fine and I wanted to get some additional backing before doing it this year again. This type of exemption, since it relates to personal income from services, does not require me to file a Form 8833, right? Also, I was wondering, is there a way to get a "concrete" answer from the IRS on this? Thanks again seymore!
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Jan 2, 2013 04:21
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I'm in the 2nd year of my photography business, it's a side business and I asked for and got great help here. This year, due to a big move to California, I did not make as much as I did last year, just under $4000. But right at the end of the year I bought $7185 of camera equipment. Last year I made about $6000 and spent about $3000 on equipment. How risky is it to deduct a lot of that equipment, even with depreciation/amortization, will most likely be over the $4000 I made. What is the risk, I guess, of taking a ~$3000 loss in your 2nd year of a small business? I'm registered as a business and have a business checking account/etc. I do anticipate making more in 2013. If it's a bad idea, I'll just not deduct one or two of my lenses and that will leave me in profit territory. edit: I don't think that's "Cheating" is it? To not deduct something, to play it safe, right? I don't want to do that either.
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Jan 2, 2013 08:40
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JosephStalinVEVO posted:I'm in the 2nd year of my photography business, it's a side business and I asked for and got great help here. This year, due to a big move to California, I did not make as much as I did last year, just under $4000. But right at the end of the year I bought $7185 of camera equipment. Last year I made about $6000 and spent about $3000 on equipment. You should be fine, assuming you're not using any of that equipment for personal use. theacox posted:On top of my salary this year, I have been dabbling in sports collectibles. I understand that paypal will be reporting this income, as it is past the 200 transactions limit. I realize that I will need to report this as income, as well as being able to deduct the expenses for it (right? You'll just be reporting your sales on Schedule D. You just report the gross selling price, and use what you originally paid for the collectible as the the basis. The difference between the two will be your gain. Collectibles have their own special tax rates. SnatchRabbit posted:I am attempting to see if I can comprehend my taxes enough to do them Is Schedule E generating any kind of income/loss? For your second scenario, what do you mean that "it does not deduct anything for the time I lived there as my main home"? My expected result from what you explained is this: you should be generating some kind of small income/loss on schedule E (likely loss), that should flow through to page 1 of your 1040 assuming you don't have a high income. I would also expect roughly half of your mortgage interest/real estate taxes to be deductible on schedule A. edit: this sounds like you may have not input the information correctly. I shot from the hip with this response, but the above is my recollection of first year rentals. Admiral101 fucked around with this message at 19:28 on Jan 2, 2013 |
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Jan 2, 2013 14:39
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3 Similar questions: 1) A mother holds shares of a stock for 10 years, then transfers that stock to their adult son who sells it for cash the day after receiving it. Does the recipient pay long term or short term capital gains tax? 2) Same question, but from a husbands account to a wife's. 3) Same question again, but from a father's account to a custodial account for his infant son.
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Jan 2, 2013 17:36
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The holding period of gifted stock for the donee will include the holding period of the donor.
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Jan 2, 2013 19:05
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I just recently returned back home to California for good from South Korea after working over there for the last two years. I filed for a 2555-EZ form about a year ago, but never needed to present it to my employer (public school run by the government). With tax season coming up do I need to fill out that same form again? I haven't done anything with the IRS since I got my residence certificate a year ago and I made 50k total during those two years so I do fit under the exclusion. Based on this link: http://www.irs.gov/uac/Instructions-for-New-Streamlined-Filing-Compliance-Procedures-for-Non-Resident-Non-Filer-US-Taxpayers Do I need to go through all of these steps for writing off a couple years of government paid work?
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Jan 2, 2013 19:52
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http://business.time.com/2013/01/02/despite-deal-taxes-rise-for-most-americans/#ixzz2GqVRwTOgquote:Social Security is financed by a 12.4 percent tax on wages up to $113,700, with employers paying half and workers paying the other half. Obama and Congress reduced the share paid by workers from 6.2 percent to 4.2 percent for 2011 and 2012, saving a typical family about $1,000 a year. Does this mean that compared to 2011/12, in 2013 my employer is now paying less in social security taxes, I am paying more, but the same total amount as a percentage is being paid to the government?
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Jan 2, 2013 19:56
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baquerd posted:http://business.time.com/2013/01/02/despite-deal-taxes-rise-for-most-americans/#ixzz2GqVRwTOg You pay 2% more in social security meaning your pay will go down by 2%. The 2% decrease in 2011-2012 was picked up by the government not your employer.
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Jan 2, 2013 20:02
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Does the IRS still publish a Tax Product Posting Schedule, or does anyone know when valid 2012 instructions and tax tables might be available? Does this now fall to the "January 5" schedule along with Pub 15? I need to get my refund and boost the economy. 
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Jan 2, 2013 20:33
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What are the realistic chances of being able to negotiate with the IRS and the CA FTB? Due to some serious assholery by my employer in 2012 it looks like I'm going to owe somewhere between $2,300-$4,500 to the IRS and maybe $2000 to CA. I don't have my w2 yet, so these are all based on my last tax stub of the year and 3 different online tax estimators. Regardless, my ability to pay $4,300-$6,500 is non existent and I'd like to know if I have any chance of working with the interested parties to make it easier in any way. I could do maybe $200 / month on payments, but I'm not sure if the IRS would allow that little amount, and I have no idea what dealing with CA FTB would be like.
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Jan 2, 2013 22:48
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DiverTwig posted:What are the realistic chances of being able to negotiate with the IRS and the CA FTB? Due to some serious assholery by my employer in 2012 it looks like I'm going to owe somewhere between $2,300-$4,500 to the IRS and maybe $2000 to CA. I don't have my w2 yet, so these are all based on my last tax stub of the year and 3 different online tax estimators. Regardless, my ability to pay $4,300-$6,500 is non existent and I'd like to know if I have any chance of working with the interested parties to make it easier in any way. I could do maybe $200 / month on payments, but I'm not sure if the IRS would allow that little amount, and I have no idea what dealing with CA FTB would be like. Can you describe the "seriousy assholery"? Did they under withhold?
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Jan 2, 2013 23:16
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Jealous Cow posted:Can you describe the "seriousy assholery"? Did they under withhold? I work with a group of about 40 other people, our current employer bought our group lock stock and barrel out from under our previous employer. Part of the deal they gave us to jump ship was that we would not have to pay for our Medical Dental Vision benefits. Fine, that's great, thanks fellas. To do this however, they were going to incorporate the annual cost of the benefits into our salaries. This adjustment was scheduled to take 2 months. During those first 2 months, we were told to file expense reports for the amount of our benefits every month and we would be reimbursed. Since I cover my 2 kids (who live with their mom full time, I pay child support) my "family" plan of benefits was around $1,300 per month. So I went on happily filing expense reports for this cost. 2 months turned into 10. This past July they finally rolled the benefits into our salaries. Now, I understand, during those 10 months I was probably committing some sort of tax fraud by getting those reimbursements and not paying any taxes on them. After the benefits were rolled into my salary, it was effectively a $16k/year raise. After the increased taxes and everything, it resulted in me bringing home ~$600 less every month. And now I'm noticing that the increase in money put me far enough into the next tax bracket that the increased amount of taxes being taken out doesn't cover the jump in tax liability. So yeah, they're assholes, and I'm stupid. At least, that's my opinion of the involved parties.
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Jan 2, 2013 23:32
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I'm in Illinois. We are regular employees, not independent contractors. I think there is a tax missing from my paystubs. Here is what I see listed: -FICA -Federal Witholding -IL State Witholding What should I look out for on my W2 at the end of the month? a_pineapple fucked around with this message at 01:53 on Jan 3, 2013 |
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Jan 3, 2013 01:42
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DiverTwig posted:What are the realistic chances of being able to negotiate with the IRS and the CA FTB? Due to some serious assholery by my employer in 2012 it looks like I'm going to owe somewhere between $2,300-$4,500 to the IRS and maybe $2000 to CA. I don't have my w2 yet, so these are all based on my last tax stub of the year and 3 different online tax estimators. Regardless, my ability to pay $4,300-$6,500 is non existent and I'd like to know if I have any chance of working with the interested parties to make it easier in any way. I could do maybe $200 / month on payments, but I'm not sure if the IRS would allow that little amount, and I have no idea what dealing with CA FTB would be like. I'll defer to furu on the FTB, but as far as IRS goes they are pretty much required to accept a payment plan for any debt under $25k as long as you've filed all your returns. just pay as much as you can with the return, wait a month or so for them to process it, then go online and set it up. http://www.irs.gov/Individuals/Payment-Plans,-Installment-Agreements
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Jan 3, 2013 02:31
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So now that the tax bill has been approved by the House and the Senate, how long until everyone can get rolling?
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Jan 3, 2013 06:48
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How does one categorize kickstarter donations?
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Jan 3, 2013 07:28
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Steve Yun posted:How does one categorize kickstarter donations? if you get a incentive (pledge $25 and get a signed coffee mug) then you're buying whatever that thing is. if you don't get an incentive, not a deductible loss. no tax consequences either way IMO.
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Jan 3, 2013 08:08
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Steve Yun posted:How does one categorize kickstarter donations? Kickstarter isn't anywhere close to a qualified charity. Not to mention you're buying a product in most cases. There's nothing to deduct.
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Jan 3, 2013 13:25
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Admiral101 posted:The holding period of gifted stock for the donee will include the holding period of the donor. Be careful on this - the kiddie tax rules might apply and make the returns more complex than the OP has realized.
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Jan 3, 2013 17:55
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