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Juanito posted:Thanks, guys. Call the IRS and ask for an extension of time, otherwise they'll assume they're correct and it's a larger pain to correct.
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Nov 20, 2014 20:33
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Just confirming this plan makes sense: My wife is a budding attorney and just started her big job this October. We also just got married in August. I believe we can file jointly this year, correct? Second question is around my bonus -- I get a sizable annual bonus which I can take either in 2014 or 2015. Typically I had pushed this to the following year but I think I want to reverse course in 2014 and take the bonus this year given we will be filing jointly next year in the uncle same fucks you in the rear end with no lube tax bracket due to her big job. Does that make general sense or am I forgetting an angle?
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Nov 21, 2014 17:43
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My wife will be collecting her retirement money from her home country in the next couple weeks. Does that count as regular income or is there a special tax structure for foreign/foreign retirement (lol maybe) income?
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Nov 21, 2014 18:08
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wwb posted:Just confirming this plan makes sense: If you get married on or before 11:59pm on December 31st you MUST file either Married Filing Jointly or Married Filing Separately for the year. Unless you have a very unique tax situation, MFJ is the way to go. Taking the bonus in 14 makes sense since your wife only has 2 months of income in 14.
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Nov 21, 2014 19:03
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Thanks for confirming.
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Nov 21, 2014 20:48
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Two part question: Part 1: I've realized that I know exactly nothing about w2 withholdings and I never questioned the "use 0 or 1" advice from family. Somewhere along the line i got the idea in my head that it was a dependent" allowance, 1 for me, 1 if i had one kid, etc so it reinforced the "0 or 1" wisdom. My coworker told me I should use 0 so I don't owe money come tax time. Out of curiosity I plugged my salary + estimated bonus - deductions into a tax refund estimator on turbo tax/tax act and I may receive a refund ranging from $4-5k!  After seeing that ridiculous number, I used the IRS withholding calculator and it says I can use up to 8 allowances. That seems crazy to me, but does it seem accurate? If it is, I wouldn't take all 8, probably half at first and reevaluate mid-year.Part 2: Related to that deductions number, I think it may be worthwhile for me to itemize my medical & educational expenses. I've spent about $2.5k in medical and $2k in tuition and fees. I don't have receipts though and I'm worried about not having sufficient documentation for the payments should I get audited. Are statements showing fees due/fees paid sufficient or do I need proof I paid it (receipts, cc statements, etc)? Am I right that I should itemize rather than do the standard deduction? Thank you 
ladyweapon fucked around with this message at 22:15 on Dec 2, 2014 |
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Nov 21, 2014 22:14
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Sephiroth_IRA posted:My wife will be collecting her retirement money from her home country in the next couple weeks. Does that count as regular income or is there a special tax structure for foreign/foreign retirement (lol maybe) income? If she's a US citizen or resident alien, then it's taxable, although she can reduce her US tax liability by foreign taxes paid on it via the foreign tax credit. ladyweapon posted:Am I right that I should itemize rather than do the standard deduction? Only if the total of all your itemized deductions exceeds the standard deduction you can take. Note that medical expenses need to exceed 10% of AGI to count as itemized deductions and tuition and fees have three options: Tuition and Fees deduction, American Opportunity credit and Lifetime Learning credit. You might not qualify on the American Opportunity, though.
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Nov 22, 2014 00:11
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ThirdPartyView posted:If she's a US citizen or resident alien, then it's taxable, although she can reduce her US tax liability by foreign taxes paid on it via the foreign tax credit. The education expenses can be taken (if he qualifies) even if he ends up using the standard deduction.
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Nov 22, 2014 00:15
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The law that made PMI tax deductible ran out at the end of 2013 as far as I know but there is mixed information online. Did they renew that for this year?
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Nov 22, 2014 00:18
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Ok, so hopefully this post will make sense. This is my first year having to file taxes, since I'm doing contract work. My issue is that the job is based out in Australia, so I get paid in AUD that later gets converted to USD in my Paypal. Either way you convert it, I'm over the 1k, so I know I need to file. (It's the 1040ES right?) But I don't know if I need to calculate the percentage with the AUD values or the USD values, since the AUD is higher than the USD. The other problem is that I'm 22, and while I count as an independent for grad school purposes, I believe my dad is still claiming me under his tax filing, which means I don't get any deductions, right? So now I'm confused if I still need to file. Coupled with that is the fact that I got offered a TA position at my university for next semester, so I know I probably have to file a different thing next year. (I don't start until Jan.) But if I'm still doing contract work (which I plan to), does that mean I have to file two separate forms next year?
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Nov 22, 2014 15:36
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You report your income in USD. Use the exchange rate prevailing at the time you received the payment. If you are over the filing limit (see Charts B and C in the 1040 instructions), you need to file, regardless of whether you are claimed as a dependent. Your standard deduction may be reduced as a result. Keep track of your expenses relating to your contract income, as you should be able to deduct them when you file. You will also likely need to pay self employment tax (depending on how much you are earning). You should look into whether you are required to make quarterly payments to avoid penalties for late payment. Your income from your TA position will be reported on the your return for next year since you don't start until January; however, to clarify, you only ever file a single 1040, no matter how many different sources of income you have in any given year. The IRS is a good place to start with this stuff: http://www.irs.gov/Individuals/Self-Employed http://www.irs.gov/Individuals/International-Taxpayers/Foreign-Currency-and-Currency-Exchange-Rates
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Nov 22, 2014 19:20
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Lets say I bought some stocks on 30 December 2013. If I sell them on 31 December 2014 are they short or long term gains?
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Nov 24, 2014 19:38
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wwb posted:Lets say I bought some stocks on 30 December 2013. If I sell them on 31 December 2014 are they short or long term gains? According to the instructions for form 8949: "To figure the holding period, begin counting on the day after you received the property and include the day you disposed of it. If you receive a Form 1099-B (or substitute statement), box 1c may help you determine whether the gain or loss is short-term or long-term." and "The holding period for long-term capital gains and losses is more than 1 year." (emphasis added) I would think short-term since if you start counting the day after and you hold a year, that is not more than a year. Bisty Q. fucked around with this message at 01:05 on Nov 25, 2014 |
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Nov 25, 2014 01:03
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Bisty Q. posted:According to the instructions for form 8949: "To figure the holding period, begin counting on the day after you received the property and include the day you disposed of it. If you receive a Form 1099-B (or substitute statement), box 1c may help you determine whether the gain or loss is short-term or long-term." and "The holding period for long-term capital gains and losses is more than 1 year." (emphasis added) Why would you start counting the day after the trade? Is there some guidance on that? I know when my trades executed down to the second, so why wouldn't I use that as the exact start time?
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Nov 25, 2014 11:33
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If I put $500 into a flexible spending account for medical costs, can I use that money to pay my wife's medical expenses, even if we married filing separately (due to income-based student loan repayment)?
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Nov 25, 2014 13:38
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Bisty Q. posted:According to the instructions for form 8949: "To figure the holding period, begin counting on the day after you received the property and include the day you disposed of it. If you receive a Form 1099-B (or substitute statement), box 1c may help you determine whether the gain or loss is short-term or long-term." and "The holding period for long-term capital gains and losses is more than 1 year." (emphasis added) Right, but is it 1.0 years or a year and a day? I've seen examples both ways . . .
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Nov 25, 2014 16:12
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AbbiTheDog posted:Call the IRS and ask for an extension of time, otherwise they'll assume they're correct and it's a larger pain to correct.
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Nov 25, 2014 17:11
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wwb posted:Right, but is it 1.0 years or a year and a day? I've seen examples both ways . . . We can let a tax accountant chime in too, though. I only have book learning and the IRS documents, no real world experience with tax.
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Nov 25, 2014 17:29
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SiGmA_X posted:We were taught a year and a day in my accounting program. The instructions for 8949 state: "begin counting on the day after you received the property and include the day alloy disposed of it". My focus isn't individual, but I've prepped a few individual returns. It's a year and a day. The 8949's instructions as quoted above are very straightforward and clear.
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Nov 25, 2014 19:54
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DNova posted:Why would you start counting the day after the trade? Is there some guidance on that? I know when my trades executed down to the second, so why wouldn't I use that as the exact start time? It's because the IRS considers that you took possession on the day AFTER the sale. Otherwise, you technically would have two people owning an asset on the same day. Example: You buy a stock on 12/31 from Bob (you're buying stock from someone, after all). There's a dividend declared 12/31. Who pays tax on the dividend? The owner. Who owns the stock? Well, if you count your date of purchase as your ownership date, then you and Bob both own the stock and associated dividend. That's not right. Hence, the "day after" rule. Goes the same for real estate.
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Nov 25, 2014 21:04
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Thanks, I think I found the right IRS thing. From Publication 544 (http://www.irs.gov/publications/p544/ch04.html#en_US_2013_publink100072633):quote:If you bought an asset on June 19, 2012, you should start counting on June 20, 2012. If you sold the asset on June 19, 2013, your holding period is not longer than 1 year, but if you sold it on June 20, 2013, your holding period is longer than 1 year. It seems that it counts the year inclusively so I think I'm good on Dec 31 to sell and still get it out inside my 2014 taxes as that is congrous to buying on Dec 30 2013 and selling on Dec 31 2014.
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Nov 25, 2014 22:21
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AbbiTheDog posted:It's because the IRS considers that you took possession on the day AFTER the sale. Otherwise, you technically would have two people owning an asset on the same day. This is a nice explanation of the IRS's thinking/interpretation, but it doesn't make actual sense. In your dividend example, whoever receives the dividend pays tax on it. If it was declared on 12/31, then I would certainly get it, because the ex-date would be after that, and disbursement even later. But in reality, one day is not granular enough. Two or more parties can certainly own on asset on the same day. Why should that be a problem? If I buy a stock on Jan 1 2015 at 10:00am and sell it Jan 1 2016 at 10:01am, that is, in the most literal sense, more than one year. All that said, if the IRS says consider it the next day, then that's how it is.
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Nov 25, 2014 22:31
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DNova posted:This is a nice explanation of the IRS's thinking/interpretation, but it doesn't make actual sense. Don't bring logic into this.
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Nov 26, 2014 18:17
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AbbiTheDog posted:Don't bring logic into this. But...this is actually a time when the IRS DID bring logic through a practical measure. Unless you want to calculate the percentage of the ownership time for the day of any transaction so everybody pays the exact amount to the second per penny or something...
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Nov 27, 2014 22:36
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It's mor3 that Congress established a distinction between short term assets and long term assets, and do the IRS needed to establish a clear cut demarcation between the two. Why should holding the asset another 24 hours be rewarded? Who knows? That's what Congress wanted, so that's why the IRS had fo come up with tbe definition.
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Nov 28, 2014 00:30
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I have a question on handling home improvements. I am not sure if the 2014 guidelines are out, so I was reading P530.pdf and I see some items mentioned. We added gutters. I didn't see them mentioned one way or another and I was wondering if that would be considered for the home improvement deduction.
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Dec 2, 2014 21:44
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Alright, got some military tax questions here...I think I might have to break down and get some professional tax advice this year. Here's some background: I'm active duty, home of record is Arizona (no state income tax because they don't tax military income). We just moved from Texas to Massachusetts. My wife was a resident of Texas (because we had to move there for military orders) and had a job there for a bit before moving. However, Texas doesn't have state income, so no need to file state income on those taxes coming up this tax season. She now has a job in Massachusetts. She became a resident in Mass. From what I can tell, come this tax season we will: 1) File federal income taxes (married filing joint), which shouldn't be a problem. 2) She'll have to file partial-year resident taxes in Massachusetts...maybe (at the end of 2014, she will have made ~4000 gross income in Massachusetts). Going forward for tax year 2015, I want to make sure she's claiming the correct amount. I'm currently claiming zero allowances (Gross income is going to be around 60,000 for me, probably 12,000 for her, so $72,000 gross total) What should I have her claim for her W-4 and her state withholding? The state withholding gives an option to claim me, but I don't think that would make sense. I figure she can claim 1 and that will be it. Maybe I should have her claim 0 so that we don't have to worry about owing state tax? I know it goes against most thinking, but I like having a tax refund each year which is why I am claiming zero allowances. I might consider bumping it up to 1 allowance on my w-4 if I still stand to get a refund out of it and get a larger paycheck out of the deal. Any suggestions are absolutely appreciated.
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Dec 3, 2014 02:47
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I just want to double check a little factoid I read. Apparently if I sell my home and it was my primary residence for 2 years then I don't have to pay taxes on the profit if it's below 250k. Is that correct?
Sephiroth_IRA fucked around with this message at 15:02 on Dec 3, 2014 |
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Dec 3, 2014 14:53
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Sephiroth_IRA posted:I just want to double check a little factoid I read. Apparently if I sell my home and it was my primary residence for 2 years then I don't have to pay taxes on the profit if it's below 250k. Is that correct? This is correct. For married couples filing jointly, the limit is 500k.
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Dec 3, 2014 16:21
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Sephiroth_IRA posted:I just want to double check a little factoid I read. Apparently if I sell my home and it was my primary residence for 2 years then I don't have to pay taxes on the profit if it's below 250k. Is that correct? The 250/500k limit IS a lifetime limit. I am not sure if the IRS tracks it, but you absolutely must.
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Dec 3, 2014 16:22
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SiGmA_X posted:The primary residence capital gains exclusion is 500k if you're married. The residence must also have been your primary residence for 2 of the last 5 years. This enable people to relocate, rent the residence out, and then sell it. Or to buy, renovate and live in, and then sell it to their LLC to use as a rental with no gains. You can qualify as long as you don't have two houses sold within two years of each other.
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Dec 3, 2014 19:56
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A couple of questions: If I sell stocks within an IRA at a loss, does that count as capital loss? If I sell stocks at a loss but fall under the AMT and don't have any capital gains to offset, can I somehow lower my tax burden?
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Dec 3, 2014 20:52
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I am currently going to school full time and my employer is paying tuition assistance. However, they pay only the "tuition" portion of my bill. There are many other fees that the school charges such as library fee, lab fees, ID card fee, etc, etc. The tuition portion per semester accounts for about $1000 while the "other" fees are around $200-$250. I've been paying the other fees out of my pocket but is that at all tax deductible?
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Dec 3, 2014 22:32
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Invicta{HOG}, M.D. posted:A couple of questions: Not a tax professional, but I can tell you that losses within an IRA do not effect your taxes. The only thing that matters is your contributions to the IRA vs. the money you take out of the IRA. If it is a Roth IRA, then even those really don't matter. (Unless you are pulling money out earlier than retirement, but thats a whole other topic). If you have sold stocks outside of an IRA for a net loss, you can deduct up to $3,000 of that loss from your income. Any amount over $3,000 is carried over to the following year.
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Dec 4, 2014 17:14
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flowinprose posted:If you have sold stocks outside of an IRA for a net loss, you can deduct up to $3,000 of that loss from your income. Any amount over $3,000 is carried over to the following year. He's asking about how it impacts AMT, and you can deduct the same loss under AMT as under regular tax rules (MOST of the time). AMT done on Form 6251, so check there to make sure. If you got the stock via ISOs that's a different story.
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Dec 4, 2014 21:00
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Scrapez posted:I am currently going to school full time and my employer is paying tuition assistance. However, they pay only the "tuition" portion of my bill. There are many other fees that the school charges such as library fee, lab fees, ID card fee, etc, etc. The tuition portion per semester accounts for about $1000 while the "other" fees are around $200-$250. ThirdPartyView posted:
Fees are generally deductible if they are a mandatory part of the education; eg lab fees, materials fees, and so forth. If they're optional extracurricular activities (fee to use college gym, frat expenses, bribes for professors) they are not deductible. The American Opportunity credit is limited to undergrad studies, IIRC.
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Dec 5, 2014 03:19
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sullat posted:Fees are generally deductible if they are a mandatory part of the education; eg lab fees, materials fees, and so forth. If they're optional extracurricular activities (fee to use college gym, frat expenses, bribes for professors) they are not deductible. The American Opportunity credit is limited to undergrad studies, IIRC. Thanks for the reply. That is what I was looking for. Definitely mandatory as part of the particular classes Im taking or general fees that the school requires for being a student. Think it's pretty ridiculous that the company doesn't cover all mandatory costs associated with taking classes but hey at least they're covering the bulk of it.
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Dec 5, 2014 03:44
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Obamacare question: I estimated my income for 2014 to be $25,000 (or so), and I ended up with a $150 per month subsidy on my medical insurance. As I understand it, if someone ends up making more than they estimated, they may have to pay this subsidy back. However, what happens if someone makes much less than they estimated? Like, so much less that they wouldn't have originally been eligible for the program at all? My understanding is that you have to have some minimum income to qualify for the program, which I believe in my case, as a single person, is somewhere in the neighborhood of $17,000 per year. If I fail to make $17,000 this year (or whatever the minimum was), will I have to pay back all the subsidy amounts that I've received? I ask the question because I have a choice of taking a bunch of income in either distribution payments or as payroll, and so my income for the year will be anywhere between $7,000 and $20,000, depending on how I want to do it. I want to make sure I'm not screwing myself by doing it wrong.
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Dec 10, 2014 02:27
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Orange Sunshine posted:Obamacare question: You might be better served posting your question in the PPACA thread: http://forums.somethingawful.com/showthread.php?threadid=3540057 The clawbacks are kind of up in the air at this point, as far as I know. Do you live in a state with the Medicaid expansion?
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Dec 10, 2014 04:40
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I just wanted to double check something about AGI. If my wife and I were to both open traditional IRAs and max them out (5500 each so 11,000) our AGI would be our gross income minus 11,000. Is that correct? Do pretax 401k contributions also lower my AGI? What about pretax healthcare and hsa contributions? I just found out that there's a savers tax credit I wasn't aware of. If I can max both and both lower my AGI it seems like I might be able to qualify for a pretty big tax credit. http://www.irs.gov/Retirement-Plans...0%99s-Credit%29 Sephiroth_IRA fucked around with this message at 15:26 on Dec 10, 2014 |
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Dec 10, 2014 15:19
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