US Income Tax Thread: Bank error in your favor! GO DIRECTLY TO JAIL.

The Something Awful Forums > Discussion > Ask/Tell > Business, Finance, and Careers > US Income Tax Thread: Bank error in your favor! GO DIRECTLY TO JAIL.

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Earth: Nov 6, 2009; I WOULD RATHER INSERT A $20 LEGO SET'S WORTH OF PLASTIC BRICKS INTO MY URETHRA THAN STOP TALKING ABOUT BEING A SCALPER.; College Slice

I have an issue that maybe someone can help with. I quit my last job in Dec 2011, and they gave me a check for the last of the money they owed me in Jan 2012 (fuckers), and took out that state taxes on that check. However, I moved to my current place of living on Dec 28th 2011 and have lived in my current state the entire year. As far as I understand I don't have to pay taxes to the state I didn't live in. Is this correct?

EDIT: I should clarify.

Dec. 28th 2011 moved to current state and have not moved since.
Jan. 5th 2012 received last paycheck from prior company with prior state taxes taken out, but not current state taxes.

What I understand is that I'm going to have to file with the prior state to get those taxes back by saying I didn't live there. Is this correct?

Earth fucked around with this message at 22:19 on Jan 30, 2013

# ? Jan 30, 2013 22:16

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# ? May 9, 2024 22:33

AbbiTheDog: May 21, 2007

Dragyn posted:

In a similar vein, what sort of thing do you see get inquired/audited often? I always claim a few hundred in non-cash donations, but I never get receipts. I'm always afraid I'm gonna get a letter one day.

Just get a receipt. Not much of a hassle.

Biggest thing this year was self-employed (schedule C filers). The auditors (at least in this neck of the woods) said they were not focusing on the corporate filers as much since they get "more bang for their buck" going after the SE tax.

# ? Jan 30, 2013 22:17

Jealous Cow: Apr 4, 2002; by Fluffdaddy

I finally got all my paperwork together and I'm working on my return for 2012. One of the companies I worked for as a W2 employee included non-taxable reimbursements using code L in box 12 because I had to use my personal card for a few weeks until my business card showed up. The amount they put in this box is correct, just over $6k.

For my job related expenses I only entered unreimbursed items such as my home office, internet, and a business phone. These added up to a very small amount.

I get the following error from HR Block when it checks for accuracy:

HR Blockhead posted:

Reimbursements received from your employer and entered on Employee Business Expenses cannot be less than reimbursements shown on Form W-2, box 12, code 'L'.

I tried entering the reimbursement amount as "other employer reimbursed expenses" but it increased by tax liability by almost $2300.

Any idea what is going on here? This reimbursement amount shouldn't have anything to do with anything. It was all qualified expenses incurred while traveling for business, and once I switched to the corp card there were no more reimbursement payments.

# ? Jan 30, 2013 22:42

furushotakeru: Jul 20, 2004; Your Honor, why am I pink?!

Jealous Cow posted:

I finally got all my paperwork together and I'm working on my return for 2012. One of the companies I worked for as a W2 employee included non-taxable reimbursements using code L in box 12 because I had to use my personal card for a few weeks until my business card showed up. The amount they put in this box is correct, just over $6k.

For my job related expenses I only entered unreimbursed items such as my home office, internet, and a business phone. These added up to a very small amount.

I get the following error from HR Block when it checks for accuracy:

I tried entering the reimbursement amount as "other employer reimbursed expenses" but it increased by tax liability by almost $2300.

Any idea what is going on here? This reimbursement amount shouldn't have anything to do with anything. It was all qualified expenses incurred while traveling for business, and once I switched to the corp card there were no more reimbursement payments.

Increase your unreimbursed expenses by the amount on your W-2 code L. Boom, problem solved, assuming that the software doesn't try to deduct them. It should, I think, take the gross amount of expenses and then reduce them by the amount in Box 12.

# ? Jan 30, 2013 22:46

Jealous Cow: Apr 4, 2002; by Fluffdaddy

furushotakeru posted:

Increase your unreimbursed expenses by the amount on your W-2 code L. Boom, problem solved, assuming that the software doesn't try to deduct them. It should, I think, take the gross amount of expenses and then reduce them by the amount in Box 12.

Ok, thanks that helped. It wanted me to enter expenses and reimbursements to see if it agreed with box 12, rather than using the value from box 12 the reimbursement amount.

# ? Jan 30, 2013 22:58

Imapanda: Sep 12, 2008; Majoris Felidae Peditum

So. I'm literally a humungous 21 year old babby who doesn't know poo poo about all this tax and money poo poo for adults. (High school dropout -- I spent the last 3 years playing computer games and ruining my health)

I had my first job last fall, and it ended recently at the end of December, it was only seasonal. I'm wanting to get into college but my family and friends aren't much of a help, so I'm trying to use the internet and my own knowledge to sign up for this stuff. I need to fill out a FAFSA form though to determine how much college loans I'm able to get, but it says one of the requirement I need is my W-2 form. Is this just a simple letter I get in the mail from my employer? Or do I need to request it from my previous employer or what.

# ? Jan 30, 2013 23:29

AbbiTheDog: May 21, 2007

Imapanda posted:

So. I'm literally a humungous 21 year old babby who doesn't know poo poo about all this tax and money poo poo for adults. (High school dropout -- I spent the last 3 years playing computer games and ruining my health)

I had my first job last fall, and it ended recently at the end of December, it was only seasonal. I'm wanting to get into college but my family and friends aren't much of a help, so I'm trying to use the internet and my own knowledge to sign up for this stuff. I need to fill out a FAFSA form though to determine how much college loans I'm able to get, but it says one of the requirement I need is my W-2 form. Is this just a simple letter I get in the mail from my employer? Or do I need to request it from my previous employer or what.

They are required to mail them to you by 1/31. If it doesn't show by the end of the week call and ask.

They are legally required to give you a copy of your paystub showing "year to date" info with every paycheck, you could also pull your last paystub and run the fafsa with that (assuming it's accurate).

# ? Jan 30, 2013 23:59

DJCobol: May 16, 2003; CALL OF DUTY!; Grimey Drawer

During 2012 I participated in an employer based 401(k) program and contributed far less than the $15k max or whatever it is pre-tax. However, I also made almost $4800 in contributions to a Vanguard traditional IRA account (not a Roth, although I have one of those from the year before too). When doing my taxes its telling me that the $4800 I put into my traditional IRA through Vanguard (not work) does not count. Well what the hell? I'm sure as poo poo gonna be taxed on that eventually when I make deductions from that? Why is that not counting as deductible? Just because I have a work 401(k) too? Did I just screw myself by putting the money into the traditional IRA instead of the Roth?

# ? Jan 31, 2013 01:01

AbbiTheDog: May 21, 2007

DJCobol posted:

During 2012 I participated in an employer based 401(k) program and contributed far less than the $15k max or whatever it is pre-tax. However, I also made almost $4800 in contributions to a Vanguard traditional IRA account (not a Roth, although I have one of those from the year before too). When doing my taxes its telling me that the $4800 I put into my traditional IRA through Vanguard (not work) does not count. Well what the hell? I'm sure as poo poo gonna be taxed on that eventually when I make deductions from that? Why is that not counting as deductible? Just because I have a work 401(k) too? Did I just screw myself by putting the money into the traditional IRA instead of the Roth?

If you're covered by an employer plan and your income is too high you cannot make deductible IRA/Roth contributions.

You might not be able to contribute to any IRA.

# ? Jan 31, 2013 01:27

DJCobol: May 16, 2003; CALL OF DUTY!; Grimey Drawer

AbbiTheDog posted:

If you're covered by an employer plan and your income is too high you cannot make deductible IRA/Roth contributions.

You might not be able to contribute to any IRA.

Well poo poo, there's my answer I guess: IRS link. I make well below the $110k single filer limit, but apparently over the AGI limits for deductions on traditional IRA contributions. Supposedly I won't get taxed on those withdraws in the future, but we'll see. Like I'm gonna remember that poo poo in 30-35 years.

Wish I would have known that when deciding whether to funnel the $5k a year into a traditional or a Roth. Here I was thinking I was going to get some of that back this year. Lesson learned, dump all my money into the Roth this year and in the future.

# ? Jan 31, 2013 01:33

AbbiTheDog: May 21, 2007

DJCobol posted:

Well poo poo, there's my answer I guess: IRS link. I make well below the $110k single filer limit, but apparently over the AGI limits for deductions on traditional IRA contributions. Supposedly I won't get taxed on those withdraws in the future, but we'll see. Like I'm gonna remember that poo poo in 30-35 years.

Wish I would have known that when deciding whether to funnel the $5k a year into a traditional or a Roth. Here I was thinking I was going to get some of that back this year. Lesson learned, dump all my money into the Roth this year and in the future.

The Roth limits might kick in and you might not be able to contribute.

For the IRA Form 8606 is what you'll need to file to track your IRA basis. THE IRS DOES NOT TRACK THIS FOR YOU. You will need to do this until all of your IRA funds are zero, not just for this account. It sucks, and it also converts earnings on this account into ordinary income but you don't get the tax deferral.

# ? Jan 31, 2013 02:07

Jealous Cow: Apr 4, 2002; by Fluffdaddy

Well, the Feds aren't processing returns with a 4562 until March and New York isn't accepting any E-File returns at all yet. And also New York mandates that if you use "software" to create your tax return you are required to e-file.

Also, I think I'm living wrong:

code:

Year		Marginal		Effective
2012		28%			20%
2011		28%			18%
2010		25%			16%
2009		25%			11%
2008		25%			10%
2007		25%			13%

I need to work a bit harder to get my effective rate back down.

# ? Jan 31, 2013 02:20

ForkPat: Aug 5, 2003; All the food is poison

*Edit* NVM, Just educated myself on differences between marginal and effective tax rates.

VV Thank you, Jealous Cow for the info, I edited it right before you posted

ForkPat fucked around with this message at 02:48 on Jan 31, 2013

# ? Jan 31, 2013 02:21

Jealous Cow: Apr 4, 2002; by Fluffdaddy

PorkFat posted:

Concerning tax brackets:

I'm trying to figure out if dumping 10K (filing joint) into 2 IRAs before we file will be worth it or not.

Let's say I'm in the 25% bracket as I stand with no retirement contributions outside of my 401K

Question: Is all of the money up to 70,700 dollars taxed at 15% and everything over is at 25%? Or is the entire amount taxed at 25%?

If it's the former then it wouldn't be beneficial for me to dump money into an account I can't touch. If the latter percentage is correct, then I'll actually end up with more money in the end by getting bumped down to the next bracket despite the contributions.

Thanks.

Everything over $70,700 would be taxed at 25%. If you believe the investment will be taxed at a lower rate in the future than 25% go for it. If you believe that you'll probably be taxed at or above 25% but it in a Roth IRA or other investment.

# ? Jan 31, 2013 02:25

DJCobol: May 16, 2003; CALL OF DUTY!; Grimey Drawer

AbbiTheDog posted:

The Roth limits might kick in and you might not be able to contribute.

For the IRA Form 8606 is what you'll need to file to track your IRA basis. THE IRS DOES NOT TRACK THIS FOR YOU. You will need to do this until all of your IRA funds are zero, not just for this account. It sucks, and it also converts earnings on this account into ordinary income but you don't get the tax deferral.

Roth limit this year was $100k, which I am far, far below.

# ? Jan 31, 2013 02:32

Jealous Cow: Apr 4, 2002; by Fluffdaddy

DJCobol posted:

Roth limit this year was $100k, which I am far, far below.

I didn't realize there was an income cap for contributions. That sucks.

# ? Jan 31, 2013 02:38

milquetoast child: Jun 27, 2003; literally

I was paid $900 as a contractor by a company in the very early part of 2012. They went under in the middle of the year, and they never were the best with paperwork. I am claiming the $900 in income, but there's no freaking way they're going to get me a 1099, so what do I put down for the EIN / Tax ID number?

# ? Jan 31, 2013 02:42

Mike the TV: Jan 14, 2008; Ninety-nine ninety-nine ninety-nine; Pillbug

This last year I started a Limited Partnership business with a friend. It was a very small business and failed before the year was out. Looking over the Schedule K-1 and 1065 is giving me a migraine because we never did any sort of percentage of profit/loss/capital when we started. We know how much both of us spent and made, so should I just extrapolate what the percentage was after the fact?

I have very little money to spend. Would I be better off going to a professional or trying to figure this out myself? Another thought was filing myself as a sole proprietor (With his permission, but I put in the majority of money/time). Could he then just file his expenses as a personal expense?

# ? Jan 31, 2013 03:01

catman: Jul 23, 2006

DJCobol posted:

Well poo poo, there's my answer I guess: IRS link. I make well below the $110k single filer limit, but apparently over the AGI limits for deductions on traditional IRA contributions. Supposedly I won't get taxed on those withdraws in the future, but we'll see. Like I'm gonna remember that poo poo in 30-35 years.

Wish I would have known that when deciding whether to funnel the $5k a year into a traditional or a Roth. Here I was thinking I was going to get some of that back this year. Lesson learned, dump all my money into the Roth this year and in the future.

I won't provide specific advice to your situation, but there is a feature called a Roth conversion that you might be interested in educating yourself on and you can determine if it is appropriate for you.

# ? Jan 31, 2013 03:03

albedoa: May 3, 2004

http://forums.somethingawful.com/showthread.php?threadid=3394641&userid=0&perpage=40&pagenumber=63#post412028421

Any help? I know this was briefly covered in the OP under "What states do I need to file in?", but I am wholly confused. I earned income from one state while living in another state. How do I handle this?

# ? Jan 31, 2013 05:19

furushotakeru: Jul 20, 2004; Your Honor, why am I pink?!

DJCobol posted:

Roth limit this year was $100k, which I am far, far below.

As Abbi said, you can elect to leave your IRA contributions as non-deductible traditional IRA contributions, creating basis in your IRA, or I think you can ask your custodian to recharacterize these contributions to be Roth IRA contributions. I know for sure you can recharacterize Roth contributions to regular IRA, but I am not sure if you can do it the other way around. Logic says yes, but since when has logic had anything to do with the IRS?

albedoa posted:

http://forums.somethingawful.com/showthread.php?threadid=3394641&userid=0&perpage=40&pagenumber=63#post412028421

Any help? I know this was briefly covered in the OP under "What states do I need to file in?", but I am wholly confused. I earned income from one state while living in another state. How do I handle this?

Your income is generally taxed based on where you lived when you earned/received it, not based on where the payments are coming from.

True story: California once tried to claim that CA public pension distributions were always taxable to CA no matter where the recipient lived. The courts told them NO.

furushotakeru fucked around with this message at 06:25 on Jan 31, 2013

# ? Jan 31, 2013 06:23

DJCobol: May 16, 2003; CALL OF DUTY!; Grimey Drawer

furushotakeru posted:

As Abbi said, you can elect to leave your IRA contributions as non-deductible traditional IRA contributions, creating basis in your IRA, or I think you can ask your custodian to recharacterize these contributions to be Roth IRA contributions. I know for sure you can recharacterize Roth contributions to regular IRA, but I am not sure if you can do it the other way around. Logic says yes, but since when has logic had anything to do with the IRS?

Called Vanguard and had them convert my 2012 non-deductible traditional IRA contributions to the Roth. Also confirmed that all future automatic withholdings/transfers are going into my Roth from now on instead of the traditional. Guess I should have done more research up front when deciding where to put my money. Really wanted to build up the balance in the traditional between my contributions and the rollover balance from an old 403(b) to be able to qualify for Admiral share, but alas, its not meant to be. Yet.

# ? Jan 31, 2013 15:28

Darko: Dec 23, 2004

I've got a question about old taxes.

Apparently, I somehow missed filing my state taxes in 2007 (probably from doing them online and not paying to do the state as well, then forgetting about it). The state waited till now to contact me about it, and are charging me the max possible amount, as if I had no withholding at all taken from that.

Because it was so long ago, I can't locate a W2 from that year. This is the issue I'm running into:

- A transcript of my taxes from that period from the IRS does not include state info
- My previous employer at that time refuses to return calls or emails regarding this

Who the hell can I contact to get that old info? It has to be SOMEWHERE, since my employer obviously would have filed it with the state, but no one I call is able to give me anything, and that employer is ignoring me (because it's a bad company, which is why I don't work for them anymore).

# ? Jan 31, 2013 16:23

Epi Lepi: Oct 29, 2009; You can hear the voice
Telling you to Love
It's the voice of MK Ultra
And you're doing what it wants

Darko posted:

I've got a question about old taxes.

Apparently, I somehow missed filing my state taxes in 2007 (probably from doing them online and not paying to do the state as well, then forgetting about it). The state waited till now to contact me about it, and are charging me the max possible amount, as if I had no withholding at all taken from that.

Because it was so long ago, I can't locate a W2 from that year. This is the issue I'm running into:

- A transcript of my taxes from that period from the IRS does not include state info
- My previous employer at that time refuses to return calls or emails regarding this

Who the hell can I contact to get that old info? It has to be SOMEWHERE, since my employer obviously would have filed it with the state, but no one I call is able to give me anything, and that employer is ignoring me (because it's a bad company, which is why I don't work for them anymore).

I don't know what state you're in but here in New York the state is completely happy with not keeping withholding records and throwing the burden of proof at you. The federal government doesn't keep track of that either so unfortunately to the best of my knowledge, the only way you'll be able to get the info you need is through your old employer. It's a lovely situation I know.

The only other thing I can think to try is if you itemized and took your state taxes as a deduction that year, you might be able to try and talk your way into providing that as proof. I have no idea if that will hold water with the state but if it's you're only option it's probably worth a shot.

# ? Jan 31, 2013 16:46

Jealous Cow: Apr 4, 2002; by Fluffdaddy

Darko posted:

I've got a question about old taxes.

Apparently, I somehow missed filing my state taxes in 2007 (probably from doing them online and not paying to do the state as well, then forgetting about it). The state waited till now to contact me about it, and are charging me the max possible amount, as if I had no withholding at all taken from that.

Because it was so long ago, I can't locate a W2 from that year. This is the issue I'm running into:

- A transcript of my taxes from that period from the IRS does not include state info
- My previous employer at that time refuses to return calls or emails regarding this

Who the hell can I contact to get that old info? It has to be SOMEWHERE, since my employer obviously would have filed it with the state, but no one I call is able to give me anything, and that employer is ignoring me (because it's a bad company, which is why I don't work for them anymore).

Given your opinion of that company, are you sure they remitted your withholdings to the state at all? Maybe I'm just naive, but I find it hard to believe that a state tax agency would willfully ignore tax payments and try to make you pay it all over again unless they really didn't, or don't think they did, receive the payments.

# ? Jan 31, 2013 16:48

Darko: Dec 23, 2004

Jealous Cow posted:

Given your opinion of that company, are you sure they remitted your withholdings to the state at all? Maybe I'm just naive, but I find it hard to believe that a state tax agency would willfully ignore tax payments and try to make you pay it all over again unless they really didn't, or don't think they did, receive the payments.

They did. I got W2's from them, but that was back in 2007, and multiple moves and situations later, I don't have the information any more. They're just the type of people that won't do any more work than they absolutely have to, so they're just ignoring me since it would take 5 minutes worth of effort from them. Even a singular paycheck stub would allow me to make an estimate.

And, yes, the State of Michigan is charging me MAX WITHOLDING as if I did not pay anything at all and threatening a levy.

Epi Lepi posted:

I don't know what state you're in but here in New York the state is completely happy with not keeping withholding records and throwing the burden of proof at you. The federal government doesn't keep track of that either so unfortunately to the best of my knowledge, the only way you'll be able to get the info you need is through your old employer. It's a lovely situation I know.

The only other thing I can think to try is if you itemized and took your state taxes as a deduction that year, you might be able to try and talk your way into providing that as proof. I have no idea if that will hold water with the state but if it's you're only option it's probably worth a shot.

After calling around all morning, it looks like the best I can do is maybe file the forms with an 'estimate' of my witholdings and what I would have paid, judging by what I paid Federal that year, if no one has that information. Still, it makes no sense, since my company had to send my info -somewhere- that year.

# ? Jan 31, 2013 16:56

AbbiTheDog: May 21, 2007

Darko posted:

They did. I got W2's from them, but that was back in 2007, and multiple moves and situations later, I don't have the information any more. They're just the type of people that won't do any more work than they absolutely have to, so they're just ignoring me since it would take 5 minutes worth of effort from them. Even a singular paycheck stub would allow me to make an estimate.

And, yes, the State of Michigan is charging me MAX WITHOLDING as if I did not pay anything at all and threatening a levy.

After calling around all morning, it looks like the best I can do is maybe file the forms with an 'estimate' of my witholdings and what I would have paid, judging by what I paid Federal that year, if no one has that information. Still, it makes no sense, since my company had to send my info -somewhere- that year.

You need to call the social security administration, they keep archived copies of your W-2 forms. The IRS, if you call and ask for a wage and income transcript, will list your W-2 but only give you the federal withholding (they don't care about state).

Some states keep track of withholding and some don't. Oregon didn't used to (the employer payroll forms didn't break out withholding by employee, so they relied upon the W-2 to know what your withholdings were) but now they do. Your state might be the same.

# ? Jan 31, 2013 17:41

Earth: Nov 6, 2009; I WOULD RATHER INSERT A $20 LEGO SET'S WORTH OF PLASTIC BRICKS INTO MY URETHRA THAN STOP TALKING ABOUT BEING A SCALPER.; College Slice

Earth posted:

I have an issue that maybe someone can help with. I quit my last job in Dec 2011, and they gave me a check for the last of the money they owed me in Jan 2012 (fuckers), and took out that state taxes on that check. However, I moved to my current place of living on Dec 28th 2011 and have lived in my current state the entire year. As far as I understand I don't have to pay taxes to the state I didn't live in. Is this correct?

EDIT: I should clarify.

Dec. 28th 2011 moved to current state and have not moved since.
Jan. 5th 2012 received last paycheck from prior company with prior state taxes taken out, but not current state taxes.

What I understand is that I'm going to have to file with the prior state to get those taxes back by saying I didn't live there. Is this correct?

furushotakeru posted:

Your income is generally taxed based on where you lived when you earned/received it, not based on where the payments are coming from.

True story: California once tried to claim that CA public pension distributions were always taxable to CA no matter where the recipient lived. The courts told them NO.

Alright, thanks for this. I'm filling out through free file HR Block website right now and they are trying to claim that my Kansas taxes (where I didn't live there at all for 2012 but did receive one paycheck with KS taxes taken out) are based on my full years earnings short the KS deduction. I don't understand this at all because the last time I had to fill out for three states the software asked me how long I lived in each state.

So my situation is that the software is saying that I only get back $89 dollars of $350 KS state taxes that were taken out because.... science? I don't get this at all, and I have read the OP. Would this be one of those situations where I would be best off getting someone to do my taxes this year?

# ? Jan 31, 2013 18:03

BJA: Apr 11, 2006; It has to start somewhere
It has to start sometime
What better place than here
What better time than now

My wife and I both started college last year, we printed up our 1098-T's last night and after googling I still don't quite get how these work.

Both of them list our expenses and grants (lines 2 and 5) my wife's are about 4800 for expenses and 2300 for grants and mine is about 2800 expenses and 1500 in grants. I don't see anything about interest (is there supposed to be for the interest credit?)

Are we supposed to get more back, pay more in, based on these things or what? Some Google responses say we'll owe more in taxes based on our student loans, some say we won't.

# ? Jan 31, 2013 18:24

Sub Par: Jul 18, 2001; Dinosaur Gum

My wife has a private student loan through CitiBank and received a W9-S to fill out as part of her October statement, due to Citi by 12/15. We didn't notice (it was an electronic statement and we didn't scroll down far enough to see it). Citi is now claiming that they cannot produce a 1098-E for interest paid because the W9-S wasn't submitted. This seems like bullshit to me, because they already have her contact information, SSN, and all that jazz, so the W9-S seems superfluous.

My questions are:

1) Are they lying and can I force them to produce a 1098-E if the W9-S is submitted now?

2) If they refuse to produce 1098-E, is it legal to deduct the interest paid anyway, or do we risk getting nicked in an audit if we can't produce 1098-E but have other documentation (statements, etc.)?

Thanks. This wasn't an issue in prior years because the interest we paid on her undergrad loans hit the detectability cap so we just didn't notice that we never got a 1098-E for this loan. But now that we've paid those off, it would be nice to deduct this.

Edit: Got a more helpful person on the phone at Citi who said they would send me a letter saying how much interest I paid this year, which should suffice.

Sub Par fucked around with this message at 04:36 on Feb 1, 2013

# ? Jan 31, 2013 20:48

QuarkJets: Sep 8, 2008

DJCobol posted:

Roth limit this year was $100k, which I am far, far below.

Sorry, but where is this published? I didn't know there was an income limit for Roth IRA contributions, and it was never actually important before this year (thanks new job!)

# ? Feb 1, 2013 06:49

sellouts: Apr 23, 2003

Quick question regarding deductions.

I have a full time job with a W2.

I also have a part time freelance gig that does not 1099 me, but I declare and pay taxes on that. I also take deductions for expenses related to that.

I want to take out a credit card for my freelancing and I would like to write off any fees towards having the credit card on my taxes as a business expense. It will be used for 100% freelance expenses and nothing personal. Can I do this? And do I need to get a business Amex or can it be a regular Amex?

# ? Feb 1, 2013 08:05

scribe jones: Sep 17, 2008; One of the key problems in the analysis of this puzzling book is to be able to differentiate a real language from meaningless writing.

sellouts posted:

Quick question regarding deductions.

I have a full time job with a W2.

I also have a part time freelance gig that does not 1099 me, but I declare and pay taxes on that. I also take deductions for expenses related to that.

I want to take out a credit card for my freelancing and I would like to write off any fees towards having the credit card on my taxes as a business expense. It will be used for 100% freelance expenses and nothing personal. Can I do this? And do I need to get a business Amex or can it be a regular Amex?

Sounds fine and it doesn't matter what kind of card it is

# ? Feb 1, 2013 08:27

rentilius: Apr 21, 2010

sellouts posted:

Quick question regarding deductions.

I have a full time job with a W2.

I also have a part time freelance gig that does not 1099 me, but I declare and pay taxes on that. I also take deductions for expenses related to that.

I want to take out a credit card for my freelancing and I would like to write off any fees towards having the credit card on my taxes as a business expense. It will be used for 100% freelance expenses and nothing personal. Can I do this? And do I need to get a business Amex or can it be a regular Amex?

If you take out a credit card and use it for your business, no matter what type of Amex you get, for gods sakes please keep all of your receipts.

# ? Feb 1, 2013 13:25

rentilius: Apr 21, 2010

Dragyn posted:

In a similar vein, what sort of thing do you see get inquired/audited often? I always claim a few hundred in non-cash donations, but I never get receipts. I'm always afraid I'm gonna get a letter one day.

I've started seeing more and more audits on charitable deductions.

But really the biggest triggers are multi-year Schedule-C losses and 2106 expenses

rentilius fucked around with this message at 13:39 on Feb 1, 2013

# ? Feb 1, 2013 13:35

slap me silly: Nov 1, 2009; Grimey Drawer

QuarkJets posted:

Sorry, but where is this published? I didn't know there was an income limit for Roth IRA contributions, and it was never actually important before this year (thanks new job!)

By IRS, natch, although I'm pretty sure that every time I find this page it has a different style and is at a different URL

http://www.irs.gov/Retirement-Plans/Amount-of-Roth-IRA-Contributions-That-You-Can-Make-For-2013

# ? Feb 1, 2013 14:16

Jealous Cow: Apr 4, 2002; by Fluffdaddy

rentilius posted:

I've started seeing more and more audits on charitable deductions.

But really the biggest triggers are multi-year Schedule-C losses and 2106 expenses

Speaking of 2106..

Last year I started working as a 1099 employee doing some software design. For this job I purchased a $2200 computer. During the first month or so I spent a little over $6k on travel to clients (I was subcontracting). This amount was fully reimbursed.

In the second month, we agreed that I would become a part time employee and go on their payroll. At this point I was issued a corp card and no longer had significant out of pocket expenses.

Also, I switched full time jobs to one where I work from home/travel occasionally. To support working two jobs from home I converted a spare bedroom into an office.

On my 2106, I entered the $6106 that I was reimbursed as an "other" expense and a reimbursed amount. I also claimed $388 for the use of my house, so my 2106 amount that goes to Schedule A is $388.

On my 4562 I claimed 75% on the computer I bought (I use it to browse the web, etc when traveling as I only carry one computer. Didn't seem right to claim a really high %) against $2046 in 1099 income. I took another $140 for use of my home (the $388 on my 2106 was for the other W2 job), and my total Schedule C profit for that business was $300.

So, to summarize:

I have 2 jobs:
Full time W2
Part time W2, was 1099

I bought a computer for use when I was 1099 and wrote it off against my 1099 earnings
I work from home for both jobs so I claimed part of my home deduction for each job.
I have both "business expenses" as well as "unreimbursed employee expenses"

Is the IRS going to poo poo down my world on this one? I feel like it reads as being super sketchy, but it's legit. I didn't fudge any of the numbers, if anything I left stuff out I could have claimed as to not have a loss on Schedule C. I just had a weird year. Also I overpaid FICA by $1480, so I'm asking for that back.

Also, an off topic AMT question. Is it possible to trigger the AMT without investment income? For some reason H&R Block's website added an "Other Computations" section listing my "Alternative minimum taxable income" as being my total gross earnings for the year where last year it listed $0. It generated a regular 1040 though and it says I'm due a refund.

Jealous Cow fucked around with this message at 15:26 on Feb 1, 2013

# ? Feb 1, 2013 15:23

sellouts: Apr 23, 2003

rentilius posted:

If you take out a credit card and use it for your business, no matter what type of Amex you get, for gods sakes please keep all of your receipts.

Why would getting a credit card cause this to be any different than normal?

Or out differently, don't you have to always save receipts no matter how you pay for what you write off or does the credit card make it different?

# ? Feb 1, 2013 17:56

UncleGuito: May 8, 2005; www.ipadbackdrops.com daily wallpaper updates deserving of your iPad

I moved to NY from Michigan in 2011 and for last year's return, I filled for income in both states. I just got a 1099-G form from Michigan for calendar year 2012 (tax year 2011) that lists my refund amount. Do I need to do anything with this form on my return this year or is it for informational purposes only?

# ? Feb 1, 2013 18:14

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# ? May 9, 2024 22:33

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sellouts posted:

Why would getting a credit card cause this to be any different than normal?

Or out differently, don't you have to always save receipts no matter how you pay for what you write off or does the credit card make it different?

A lot of people think their credit card statements are good enough back up that they don't need to save their receipts.

Depending on what kind of expense it is a credit card statement can be good enough though. IRS asks you to back up meals and entertainment claims? Receipts wouldn't show much if any more info than your credit card statements so no problem. IRS asks you to back up computer expenses? Credit card statements full of Best Buy purchases are harder to get accepted, legit or not.

# ? Feb 1, 2013 18:15

The Something Awful Forums > Discussion > Ask/Tell > Business, Finance, and Careers > US Income Tax Thread: Bank error in your favor! GO DIRECTLY TO JAIL.

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