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Falciform posted:Edit: Ok, so the Disqualified gain reported by my employer is the 15% discount. But why is the difference between the basis and sale price lumped in with income instead of being taxed at a separate capital gains rate and added to my income tax at the end? You're right that the 15% discount is reported on the W2. Short term capital gains are taxed at the ordinary income tax rate, not a separate capital gains rate, so it sounds to me like everything is correct unless I'm not understanding what you're asking.
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Feb 19, 2013 20:15
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Nifty posted:furushotakeru, quick question! If they bought the property in 2012 intending to rent it out, then it is placed in service that year even if they were preparing to put it on the rental market. Or, you can capitalize the expenses if you prefer, and add them to their basis for 2013 when the unit is rented out.
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Feb 19, 2013 20:23
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This probably sounds like a stupid question, but I have no idea about this stuff. I know I need to pay a tax preparer, I had a great guy for the last two years but he's not around any more. Can I trust any random Jackson Hewitt or H&R block tax preparer to do a good job, or are they like mechanics: some great, some awful? I just got married, so it's a bit complicated.
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Feb 20, 2013 00:31
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redreader posted:This probably sounds like a stupid question, but I have no idea about this stuff. I know I need to pay a tax preparer, I had a great guy for the last two years but he's not around any more. Can I trust any random Jackson Hewitt or H&R block tax preparer to do a good job, or are they like mechanics: some great, some awful? I just got married, so it's a bit complicated. Some are very good, some not so much. HRB and JH tend to mostly hire seasonal workers so the turnover rate is high from year to year. That doesn't necessarily mean that they do a poor job for you, but the likelihood of you getting someone relatively inexperienced is probably fairly high, especially if you just walk in without an appointment. There are employees who come back year after year just like any job, but those tend to book appointments with repeat customers rather than dealing with the walk-ins. At least that is my understanding, never having worked for one or gone to one for tax help.
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Feb 20, 2013 00:39
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Last year my parents claimed me as a dependant even though I was 25/26 and moved out in early June. The tax preparer told them this would be fine. My efile was rejected and I basically let it go since not claiming myself reduced it to next to nothing. But they weren't allowed to claim me due to age, I noticed this while doing this years taxes, and now I'm vaguely worried about this and that this tax preparer could have screwed them over if the IRS had noticed. Should/can I do anything?
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Feb 20, 2013 01:28
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Nevvy Z posted:Last year my parents claimed me as a dependant even though I was 25/26 and moved out in early June. The tax preparer told them this would be fine. My efile was rejected and I basically let it go since not claiming myself reduced it to next to nothing. The IRS won't notice or care unless you insist on filing claiming your own exemption. If you let it go, they won't bother anyone.
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Feb 20, 2013 01:29
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Ninja Bob posted:You're right that the 15% discount is reported on the W2. Short term capital gains are taxed at the ordinary income tax rate, not a separate capital gains rate, so it sounds to me like everything is correct unless I'm not understanding what you're asking. Sweet, this jives with some research I did today. Mailed my tax return this evening. Thanks, guys!
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Feb 20, 2013 05:09
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I'm a freelancer living in Missouri. Can anyone point me at the right places for filing quarterly for both state and Federal?
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Feb 20, 2013 22:15
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furushotakeru posted:Yes the 1000 Euros is reportable as self employment income. You can claim a foreign tax credit for what was withheld to offset some of the US income tax. Use form 1116 to calculate the credit. Where does the self employment income go? Do I pretend like she got a 1099?
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Feb 21, 2013 14:11
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kaishek posted:Where does the self employment income go? Do I pretend like she got a 1099? Yes, you report it on Schedule C (or C-EZ)
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Feb 21, 2013 18:59
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I would love to get some clarification on a question. Am I correct that you should regard income/expenses from when they were actually received/paid, not when the underlying event occurred? Specifically, my wife started working at the very end of 2012, so her first actual paycheck wasn't issued until the first week of 2013. Even though she did the work in 2012, that is classified as income for 2013, right? She hasn't gotten a W-2 from them, so that seems right? Does that also apply to other income? We sold some stuff in the 2012 Christmas season but the payment for it wasn't actually deposited until 2013 (basically we sold some art through a gallery, it sold Christmas week, we didn't get the checks until January). Is that also going to be 2013 income? I know that things like medical expenses are counted based on when you pay the bills, not when you get sick, so this seems to make sense to me. It is also a pretty tiny amount of money, but I am terrified that I will do something wrong and the IRS will burn down our apartment.
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Feb 21, 2013 19:48
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Can someone explain (in simple terms) the difference between a capital gain and a capital gain distribution? I know both are reported on Schedule D, and I see that both numbers are indicated separately on the 1099s I received from my brokerage (the capital gains on the 1099-B, the capital gain distribution on the 1099-DIV), but I don't well understand what these things are by definition, and what distinguishes them. (Attempts to self-edify have left me confused.)
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Feb 21, 2013 22:34
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Actie posted:Can someone explain (in simple terms) the difference between a capital gain and a capital gain distribution? I know both are reported on Schedule D, and I see that both numbers are indicated separately on the 1099s I received from my brokerage (the capital gains on the 1099-B, the capital gain distribution on the 1099-DIV), but I don't well understand what these things are by definition, and what distinguishes them. (Attempts to self-edify have left me confused.) Capital gains are direct recognition of a sale by you. Capital gain distributions are taxed the same and are typically when a mutual fund "re-balances" it's investments and recognizes some gain that gets passed to you. http://www.investopedia.com/terms/c/capitalgainsdistribution.asp#axzz2LZcQxdMv
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Feb 21, 2013 22:59
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AbbiTheDog posted:Capital gains are direct recognition of a sale by you. Capital gain distributions are taxed the same and are typically when a mutual fund "re-balances" it's investments and recognizes some gain that gets passed to you. Thanks. So, if I understand correctly, I have no control over when I get income from capital gain distributions, since it's determined at the whim of the mutual funds I own. Not a big deal in my case, but interesting.
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Feb 21, 2013 23:04
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Ashcans posted:I would love to get some clarification on a question. Am I correct that you should regard income/expenses from when they were actually received/paid, not when the underlying event occurred? Specifically, my wife started working at the very end of 2012, so her first actual paycheck wasn't issued until the first week of 2013. Even though she did the work in 2012, that is classified as income for 2013, right? She hasn't gotten a W-2 from them, so that seems right? Individuals are cash basis taxpayers. W-2's report earnings when they are paid, not when they are earned. Regarding the art sold: if you received the check in 2013, that will be the year that income is taxable. Note that the check becomes income to you when you receive it - not when you deposit it.
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Feb 22, 2013 00:27
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Actie posted:Thanks. So, if I understand correctly, I have no control over when I get income from capital gain distributions, since it's determined at the whim of the mutual funds I own. Not a big deal in my case, but interesting. Correct. There are some mutual funds that tout themselves as "tax efficient" because of their attempts to minimize this.
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Feb 22, 2013 00:40
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Thank you, that's a big help! I wouldn't have considered received versus deposited - we'll have to check, because it's possible we got one check right before the end of the year and didn't actually deposit it until the new year. I appreciate the help!
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Feb 22, 2013 00:43
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I gifted around $160 to a non-profit over the year, and had my taxes done for me. The person that did my taxes said to not bother with filing the gift, although I thought it would be tax-deductible. I don't make a lot of money, so I was wondering how much of a difference that the gift would make, if any.
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Feb 22, 2013 01:09
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heliotroph posted:I gifted around $160 to a non-profit over the year, and had my taxes done for me. The person that did my taxes said to not bother with filing the gift, although I thought it would be tax-deductible. I don't make a lot of money, so I was wondering how much of a difference that the gift would make, if any. Donations to charity are one of the itemized deductions - you have a choice whether to take your actual itemized deductions or the standard deduction. The other common itemized deductions are mortgage interest, real property taxes, state or local income taxes paid, and medical expenses that exceed 7.5% of income. If the sum of those deductions doesn't exceed your standard deduction it's better for you to take the standard deduction. For a single person the standard deduction is $5950 this year, head of household is $8700, and married filing jointly is $11,900. So if all you had for itemized deductions were your charitable contributions, your tax person did the right thing in having you take the standard deduction.
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Feb 22, 2013 03:07
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Edit: Nevermind, had 401k/Roth401k and Traditional/Roth IRA confused 
Prescription Combs fucked around with this message at 21:45 on Feb 22, 2013 |
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Feb 22, 2013 09:10
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Prescription Combs posted:I was filling out my taxes with turbotax and when I came to the retirement section it was reporting that I over contributed to my IRA. The way I have contributions setup I though I was sending 6% pre tax to a traditional IRA and 6% post tax to a Roth. There was a comment in the turbotax Q/A section that mentioned applying the excess amount to my 2011 IRA contribution. Would that mean I subtract the overage amount from 2012 and apply that to 2011? http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-IRA-Contribution-Limits says you're limited to a $5000 contribution total across all your IRAs, so your top choice would be to "withdraw the excess contributions from your IRA by the due date of your individual income tax return" and "withdraw any income earned on the excess contribution". I would hope your Roth account manager would be able to disclose the latter amount and issue a corrected form.
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Feb 22, 2013 14:26
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I am employed as a research assistant by the Research Foundation of a public university. I purchased a laptop with my own funds that is used extensively for conducting my research work. The cost of the laptop is above 2% of my AGI and since I'm a non-resident alien I can't get the standard deduction anyway, so anything I can itemize helps. Can I deduct its cost as a business expense?
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Feb 22, 2013 19:11
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I don't know if this is the type of advice people give since it's not so specific, but I'm wondering if anyone has a great accountant in the Boston area. Any sites for finding good accountants? None of my friends use them so they are no help, but I have 4 years of back taxes to deal with, just got married, and obviously suck at doing taxes so I need one.
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Feb 22, 2013 21:20
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So I've done my taxes the exact same way for the last five years - Taxact.com. Since I would only be filling out a 1040ez anyway, I assume there's nothing a more expensive "tax guy" at a firm could do for me. My refunds were getting better and better every year until I started work at one particular restaurant. I usually have a few W-2s to enter in on the website, so I can frequently see how each affects my return. The year I started working for this restaurant, I punched in 3/4 of my W-2s, had a healthy refund so far, then lost a good chunk of it upon entering the data for the new place. I was shocked. Had they under taxed me or something? This was last year, when I only had the last few months of the year with the new place. I took the smallest refund I had gotten in years and dealt with it. This year, when I have an entire year with the restaurant, my refund is looking to be worse than ever, like 30% of what is usually is. I again chalked it up to under taxing and was content with the idea that I probably had the extra money all year then, anyway. However, a co-worker in the same position as me, who claims to have made almost exactly as much through the year, went to "a tax guy" and has a huge refund coming, roughly three times mine. Is there anything I should be looking more closely at?
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Feb 23, 2013 22:31
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Advice posted:So I've done my taxes the exact same way for the last five years - Taxact.com. Since I would only be filling out a 1040ez anyway, I assume there's nothing a more expensive "tax guy" at a firm could do for me. My refunds were getting better and better every year until I started work at one particular restaurant. I usually have a few W-2s to enter in on the website, so I can frequently see how each affects my return. The year I started working for this restaurant, I punched in 3/4 of my W-2s, had a healthy refund so far, then lost a good chunk of it upon entering the data for the new place. I was shocked. Had they under taxed me or something? This was last year, when I only had the last few months of the year with the new place. I took the smallest refund I had gotten in years and dealt with it. How much did he have withheld? Have to pay it in, to get it back (most of the time).
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Feb 23, 2013 22:41
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I'll ask him, but we had the same dependents listed (none). Would it be unusual for an employer to tax two identical employees differently?
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Feb 23, 2013 22:48
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Advice posted:I'll ask him, but we had the same dependents listed (none). Would it be unusual for an employer to tax two identical employees differently? It entirely depends on how many allowances you claimed on form W-4 when you started work. If you claim a bunch of allowances then your employer won't withhold as much money (withholdings being the taxes you prepay at the time of your paycheck) and you'll owe more at the end of the year. If you don't claim any allowances then your employer will withhold more (meaning you've prepaid the IRS more) and you will get a bigger refund.
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Feb 23, 2013 23:24
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Shear Modulus posted:It entirely depends on how many allowances you claimed on form W-4 when you started work. If you claim a bunch of allowances then your employer won't withhold as much money (withholdings being the taxes you prepay at the time of your paycheck) and you'll owe more at the end of the year. If you don't claim any allowances then your employer will withhold more (meaning you've prepaid the IRS more) and you will get a bigger refund. Sorry, this is what I meant by "dependents". We both have allowances set to zero.
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Feb 23, 2013 23:27
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Advice posted:Sorry, this is what I meant by "dependents". We both have allowances set to zero. I don't know enough about your situation to know for sure, but I have a few guesses. 1. Did you have more than one job this year (or more jobs than him)? Your employer is going to withhold based on they expect you to owe based on the wages they pay you, so if you had several employers that all independently thought you would be at a low tax rate, they'd withhold according to that. If you add all the money up your total dollar amount might be above the cutoff for this tax bracket and your dollars above that would be taxed at a higher rate. Something like this: Employer A pays you $10K, which means you would owe something like $1100 in taxes and withholds according to that. Employer B also pays you $10K, and withholds similarly. Your gross pay is $20000, but since you are taxed 15% on dollars above ~$9000, your actual amount owed is closer to $2500 before deductions than $2200 (what your withholding was based on). 2. Did he claim the Earned Income Tax Credit? 3. Did he itemize deductions and deduct mortgage interest or something?
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Feb 23, 2013 23:53
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1. Yeah I did actually, I'm inputting four W-2s this year. But if it's worth anything, like 90% of the wages were from this one employer. 2. Ooh, I had to google this. Maybe he did. 3. I severely doubt this. He's essentially a waiter like me, and he lives with his parents. I can't imagine he had much to claim. But these are the sort of things I wonder if a tax institution could be of service for.
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Feb 24, 2013 00:11
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How are your withholdings determined? I am filing with HR Block and for some reason this year my withholdings throughout the year were less than the total amount of tax owed, and now I unexpectedly owe $900 to the government, when I've always received a refund in the past. I'm really confused at how I could have gotten myself in this situation. I didn't do anything different on my return, my income increased but I remained within the same tax bracket. It just looks like the withholdings weren't enough to meet my liability for some reason... and the site is also saying I'll owe a penalty because of that?
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Feb 24, 2013 18:10
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Quick check to make sure I'm filing correctly: Divorced with two kids, I claim HOH and dependent for one, my ex claims the same for the other. I paid $4063.77 for daycare last year, that was my 57% for both kids. The ex paid her portion of the daycare bill. So do I claim the $2371.20 that makes up the portion for my dependent and then form 2441 for a "qualifying person not listed on 1040" for the rest of the $1693 for my other child that my ex claims as her dependent?
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Feb 24, 2013 21:36
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ashgromnies posted:How are your withholdings determined? Your withholdings are determined by the form you fill out with your employer (w-4) when you start working. If you're single, no children, then it's just "2" on the w-4. If you have children, receive the appropriate credits for the little nippers, and take the dependent care credit, it's like a million or something. And you'll get almost nothing withheld. So you determine the amount withheld. You can have additional funds withheld as sort of a "mandatory savings" if you want a bigger refund, but obviously that means less in your paycheck each pay-period. If something changed during the tax year to reduce the amount you should have withheld (divorce, children growing up, or otherwise losing the Child Tax Credit) your withholding on the w-4 doesn't automatically change to reflect that; you need to follow up with Human Resources to make the changes. And since those changes apply to the entire tax year, while the new withholding would just apply to the remaining year... it could be painful. And yeah, you'll want to make sure you owe less than $1000 at the end of the year or the government gets in a penalizing mood.
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Feb 24, 2013 21:45
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Nope, no life events, single with no dependents ever. My taxable income increased by about $7,000, that's the only change in 2012. Though I did change my employer halfway through 2011, and maybe I set up my withholdings incorrectly. Could have sworn I just did "2" like the instructions said though. Is there any way to check?
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Feb 24, 2013 22:47
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ashgromnies posted:Nope, no life events, single with no dependents ever. Some paystubs/w2 forms list them. Otherwise you'd need to check with HR monday and ask to see your W-4 form.
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Feb 24, 2013 23:17
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One of the things I hate the most about tax season is explaining to my clients that they did nothing wrong and followed the instructions on the W-4 perfectly, but that they owe anyways because the W-4 worksheet and payroll withholding tables are stupid and cannot accurately calculate withholding on anything more complex than a single person with one job, no dependents, and using the standard deduction. I had to do this about three times on Saturday alone. I feel frustrated for taxpayers who don't have the tools and background to understand this and make the necessary changes to their withholding, which is why I do it for my clients at no additional cost when they hire me to prepare a return.
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Feb 25, 2013 18:29
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furushotakeru posted:One of the things I hate the most about tax season is explaining to my clients that they did nothing wrong and followed the instructions on the W-4 perfectly, but that they owe anyways because the W-4 worksheet and payroll withholding tables are stupid and cannot accurately calculate withholding on anything more complex than a single person with one job, no dependents, and using the standard deduction. I agree entirely with how the materials commonly provided by employers is in no way sufficient to handle any complex situations. Last year I had 4 W2 jobs and 1 1099-MISC. Luckily I had several thousand in FICA withheld over the cap because I came close to the cap but never went over at any one employer, and none of them would stop withholding even if I provided pay stubs showing my YTD earnings. Each W2 I added seemed to cause my over/under payment to swing widely from owing to receiving. Crazy stuff. Edit: Also, gently caress you ashgromnie! You killed me so many times running to Uziz! 
Jealous Cow fucked around with this message at 19:28 on Feb 25, 2013 |
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Feb 25, 2013 19:25
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Employers are compelled to withhold FICA even if they have knowledge that the employee has maxed out FICA withholding elsewhere. You get your 4.2% back if you go over the cap, but the company still has to pay their 6.2% on your wages until you reach the cap at that employer. They don't get that back, the system just keeps the contributions.
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Feb 25, 2013 19:47
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furushotakeru posted:Employers are compelled to withhold FICA even if they have knowledge that the employee has maxed out FICA withholding elsewhere. You get your 4.2% back if you go over the cap, but the company still has to pay their 6.2% on your wages until you reach the cap at that employer. They don't get that back, the system just keeps the contributions. I suppose fixing that would be a record keeping nightmare.
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Feb 25, 2013 19:59
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Jealous Cow posted:I suppose fixing that would be a record keeping nightmare. Why would they "fix" it? They still get to keep the employers' excess contributions. This is assuming that it wasn't how the system was intended to function in the first place, which I kind of suspect.
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Feb 25, 2013 22:30
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