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SiGmA_X posted:I don't know about the reporting rules at play, but the USPS damaged and returned my 1065 and when we re sent it in, the IRS sent a nastygram asking for (I believe) $195*3mo*2partners! That was simple to get waived, but try to avoid that! Note you only can get it waived once. E-file next time.
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Jan 5, 2016 23:35
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Admiral101 posted:If you're cash based, you never took the freelance work into income. Makes sense. Thanks.
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Jan 5, 2016 23:44
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AbbiTheDog posted:Note you only can get it waived once. E-file next time. SiGmA_X fucked around with this message at 06:02 on Jan 6, 2016 |
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Jan 6, 2016 04:09
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AbbiTheDog posted:Note you only can get it waived once. E-file next time. Technically, it's once every four years (since the First-Time Abate rules state you can use it whenever you haven't had a penalty for the last three tax years).
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Jan 6, 2016 04:12
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ThirdPartyView posted:Technically, it's once every four years (since the First-Time Abate rules state you can use it whenever you haven't had a penalty for the last three tax years). Thanks for the heads-up. Since they implemented this in what, 2009? Haven't run into it enough (we terminate the clients that habitually come in late).
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Jan 6, 2016 21:00
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AbbiTheDog posted:Thanks for the heads-up. Since they implemented this in what, 2009? Haven't run into it enough (we terminate the clients that habitually come in late). The firm I'm at has seems to attract a significant amount of multi-year delinquent clients (a good portion of them are US citizens and residents living abroad that need to do the Offshore Voluntary Disclosure Program for FBARs), so it's not uncommon for me to get assigned 6 or 7 years of FBARs/returns to prepare or review. Still, when I see clients with those many years of returns or haven't filed a return for the last 5 years (while being a client with us), I do sometimes wonder if the partner that brought in their business got a big enough retainer... 
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Jan 7, 2016 00:37
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My wife and I got married in August 2015, and also moved to a new state and both took new jobs in said state in the middle of 2015; we make roughly the same amount. She also is not a US citizen but files taxes anyway (here on a long-running student/work visa, green card hopefully soon). Still better off filing jointly, or do all of these little details cloud the picture?
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Jan 7, 2016 03:42
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I'm starting work at a new company in February. Part of the package was a signing bonus. They sent me the signing bonus with no tax withheld in December, two months before I start working. This seems really weird to me, but I assume it's because they want to save me (themselves?) tax money. I did not deposit the money until January, as I was travelling when it arrived. Two questions - which tax year does it count towards if the check is dated in December but deposited in January? Is there any chance I will have to pay a penalty for not withholding enough simply because this company didn't do it for me? I've never paid quarterly estimated taxes before, not sure if I'm supposed to here.
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Jan 7, 2016 17:20
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ThirdPartyView posted:The firm I'm at has seems to attract a significant amount of multi-year delinquent clients (a good portion of them are US citizens and residents living abroad that need to do the Offshore Voluntary Disclosure Program for FBARs), so it's not uncommon for me to get assigned 6 or 7 years of FBARs/returns to prepare or review. I got fed up with trying to find good (or any) junior staff we just started terminating clients left and right this year. I've probably pruned off around 20% of my practice this year.
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Jan 7, 2016 18:18
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You probably don't want to tell us what the bonus is so we don't get jealous, but if last year you weren't required to make estimated tax payments, then you wouldn't be subject to the penalty for not doing it. As far as quarterly estimated tax payments are concerned, you should definitely make them if you're otherwise going to have a big tax bill when you file. It definitely counts as income for 2015, too.
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Jan 7, 2016 18:19
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sullat posted:You probably don't want to tell us what the bonus is so we don't get jealous, but if last year you weren't required to make estimated tax payments, then you wouldn't be subject to the penalty for not doing it.
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Jan 7, 2016 18:29
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If I moved twice in 2015 (both meeting the federal distance and time requirements), am I able to claim both as deductions on my 1040? I received a relocation stipend/bonus for one move, but it was taxed as regular income in 2015 so I'm not sure if that will affect that move's deduction.
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Jan 8, 2016 04:11
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I got fired this year, but got another job pretty quickly. Between double dipping on severance and a startup bonus I'm going to be a bit over the FICA limit this year, but split between two employers. To get that back do I just put it on 1040 line 71? How do I calculate what the actual "excess" amount withheld was?
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Jan 8, 2016 06:39
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KernelSlanders posted:I got fired this year, but got another job pretty quickly. Between double dipping on severance and a startup bonus I'm going to be a bit over the FICA limit this year, but split between two employers. To get that back do I just put it on 1040 line 71? How do I calculate what the actual "excess" amount withheld was? $118,500 x 6.2% = $7,347. So any social security taxes above that amount would be excess, which would go on line 71.
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Jan 8, 2016 12:54
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C-Euro posted:My wife and I got married in August 2015, and also moved to a new state and both took new jobs in said state in the middle of 2015; we make roughly the same amount. She also is not a US citizen but files taxes anyway (here on a long-running student/work visa, green card hopefully soon). Still better off filing jointly, or do all of these little details cloud the picture? Assuming she's been here long enough on the work visa to be filing taxes on a regular 1040 and has a social security number, shouldn't have any issues there as far as tax filing goes. The states could be more complicated since you'll need to file part year resident returns for each state you lived in. If you guys were in different states before you married I'd definitely go to a professional since untangling the mess of when you earned income and where gets complicated fast. Still remember juggling a newly married couple who had lived in multiple separate states before getting married and moving to yet another state, and the one of them had a job that earned income in four separate states. Part of me sometimes wonders if the reason we never got any complaints from the states wasn't because I got it right but because all of them took a look at the situation and went  at the thought of working it out themselves to dispute it.
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Jan 9, 2016 20:37
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MadDogMike posted:Assuming she's been here long enough on the work visa to be filing taxes on a regular 1040 and has a social security number, shouldn't have any issues there as far as tax filing goes. The states could be more complicated since you'll need to file part year resident returns for each state you lived in. If you guys were in different states before you married I'd definitely go to a professional since untangling the mess of when you earned income and where gets complicated fast. Still remember juggling a newly married couple who had lived in multiple separate states before getting married and moving to yet another state, and the one of them had a job that earned income in four separate states. Part of me sometimes wonders if the reason we never got any complaints from the states wasn't because I got it right but because all of them took a look at the situation and went Nah, we've been living together since 2013 so that shouldn't be an issue. Thanks for clarifying.
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Jan 10, 2016 01:09
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In 2015 I bought a brand-new computer that I planned to use for self-employed business use. I ended up getting a permalance (W2) job that ran the entire year. I didn't end up using that new computer for any 1099 work for my side business. For the year I didn't end up earning any money with my side-business, since I didn't need to. I had planned to write off the expenses of that computer off of my taxes, but that would put me at a 3000 dollar loss for business income. Seeing as that is probably a giant red flag, I don't plan to do that. My question, then, is can I write the expense of this computer off on any earnings I make in 2016, even if I bought it in 2015? For background, I work in entertainment post-production, so all of my jobs tend to be a few months with one tv show and a few months with another. These are always W2 jobs where I am paid like an employee rather than a contractor. When I can, I will work from home on my own and take on smaller jobs that I work on a 1099. 2015 was too busy for me to end up doing that.
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Jan 10, 2016 21:36
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AlliedBiscuit posted:In 2015 I bought a brand-new computer that I planned to use for self-employed business use. I ended up getting a permalance (W2) job that ran the entire year. I didn't end up using that new computer for any 1099 work for my side business. For the year I didn't end up earning any money with my side-business, since I didn't need to. Switching an item from personal use to business use means you can begin depreciating it from the lesser of: cost or FMV (at time of of transition). FMV of the computer in 2016 is going to be lower than it was in 2015, so that needs to be accounted for. That said: this sounds like you're mixing personal and business use with this computer. Is this your only computer? Or do you have a second one that you use for personal stuff? If not, it's probably not worth depreciating at all (because you can only depreciate the business-use portion, and this is likely going to be a trivial deduction ultimately).
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Jan 11, 2016 14:08
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Hey thread, I have a question about the gift tax. Really, I want to make sure I'm interpreting the rule correctly. My understanding is that there is a 14k limit on a cash gift to an individual person. So does this makes sense for a father/mother gifting to a son/daughter in law? The father could give up to 14k to his son and then 14k to his daughter in-law. The mother can also give 14k to her son and 14k to her daughter in law. This means 56k total without having to claim the gifts. Does this sound right? Thanks!
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Jan 11, 2016 15:32
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Fireside Nut posted:Hey thread, I have a question about the gift tax. Really, I want to make sure I'm interpreting the rule correctly. Spot on. Write 4 checks to make it clear.
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Jan 11, 2016 16:16
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Thanks so much! I appreciate the extra advice too. 
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Jan 11, 2016 16:26
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Why is my employer sending me a 1095-C? I have had insurance all year. When I began my initial prep for filing, all TurboTax asked me was if I had health insurance all year. I have. It didn't ask for additional forms. Did they just not have that module completed or am I missing something?
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Jan 11, 2016 16:53
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No Butt Stuff posted:Why is my employer sending me a 1095-C? I also didn't see any place to stick it in TurboTax when I ran through my return. I don't think we're missing anything... I couldn't find anything in the TT FAQ regarding where to plug it. I think you just need to answer the yes/no question, and the IRS will compare it to what your employer files.
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Jan 11, 2016 20:02
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Admiral101 posted:Switching an item from personal use to business use means you can begin depreciating it from the lesser of: cost or FMV (at time of of transition). FMV of the computer in 2016 is going to be lower than it was in 2015, so that needs to be accounted for. It's primarily for work, with the most incidental personal use. So that is good to know. Thanks!
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Jan 11, 2016 20:26
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Question about Form 5329: Do I put in the total amount of my distribution, or the amount I actually received (I had Vanguard withhold federal tax already)? I qualify for an exemption from the 10% penalty but am not sure which amount to put down
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Jan 12, 2016 04:18
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Are there any contributions that can be made to retirement funds/savings that I can still make for 2015 to lower the overall taxable income outside of a Traditional IRA (Roth IRA's are out)? My work did not offer any retirement funds for 2015, and I ended up making way more than I thought I would this year. I'll still be investing most of what I made, but lowering the overall tax burden would help as well. Samadhi fucked around with this message at 05:47 on Jan 12, 2016 |
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Jan 12, 2016 05:32
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SiGmA_X posted:Employers are required to submit 1095-C's if you're being provided insurance. ACA thing. If memory serves it's related to getting an exemption from the penalty if you don't have insurance as proof your employer's insurance cost too much (and also a factor if you have insurance from the Marketplace because they won't give you a PTC if you can get the insurance through your employer at a reasonable cost). Honestly the 1095-B and 1095-C are still sort of optional this year; you need to be able to prove you had insurance if the IRS asks but things like proof of insurance/paying insurance bills (or for most employer-provided health insurance that nice Box 12 DD code on your W-2) still count even if you don't have the 1095-B/C, which given they pushed back the date they have to send them to you to end of March kinda tells me a lot of folks will never see the things before filing their taxes. Omne posted:Question about Form 5329: Do I put in the total amount of my distribution, or the amount I actually received (I had Vanguard withhold federal tax already)? I qualify for an exemption from the 10% penalty but am not sure which amount to put down Total amount of distribution, I can't think of any instance off the top of my head where you ever subtract out the withholding when it comes to calculating tax (withholding is paying taxes, not making what you paid suddenly tax free income).
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Jan 12, 2016 22:18
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I've lived in Texas my entire adult life, except for December of this year (and forever, moving forward) where I am now in California. Texas does not have state income tax. California does. I am freaking out about this. My salary mostly doubled and I made as much in December 2015 as I made in the first quarter of 2015 at my old job. Lots of new rules do/don't apply to me. And state income taxes are a thing now. My old job in Texas ended on ~Nov 15th and my new job in CA began on Dec 1st. First, I don't owe CA state income tax on the income I earned in Texas Jan-Nov, right? I owe CA state income tax on my December California earnings though. I think. Also, my old company cashed out my 6 weeks vacation as a lump sum bonus and taxed it as such (@ 39%?) - can I claim this as wages owed and have them taxed at the appropriate income tax rate, rather than as a bonus? This would move my tax rate on those funds ($6500 or so) from 39% down to about 25% Furthermore, I have relocation expenses (I am going to pick a round number) of about $7,000. This represents about 12% of my annual income. I believe I can write this off. I take public transit and I think you can write that off, but only if your employer takes it out of your pre-tax paycheck? Or can I just adjust my gross income down by $130/mo for Dec. http://www.bart.gov/tickets/benefits Finally, I have about $14,000 that was "earned in California" in 2015 and taxed at a rate for someone who makes about $100,000. Would I fall in to the minimum income tax bracket for state income (income earned in CA was $14K), which is something like $75 + 2% over $7500. My total federal taxable income for 2015 was probably in the $65K range. Hadlock fucked around with this message at 07:45 on Jan 13, 2016 |
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Jan 13, 2016 07:37
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Hadlock posted:Also, my old company cashed out my 6 weeks vacation as a lump sum bonus and taxed it as such (@ 39%?) - can I claim this as wages owed and have them taxed at the appropriate income tax rate, rather than as a bonus? This would move my tax rate on those funds ($6500 or so) from 39% down to about 25% At least on these two, you're mixing up how much the withholding is vs how much your tax rate will be. Companies generally withhold any lump sum payment at the "bonus" rate that you see there. But you'll be taxed at the appropriate rate when you file (and thereby refunded much of what was withheld). Irritating, but you won't get taxed more just because of how it was paid to you. Income is income. On the latter, they're withholding as though you had earned that salary all year...but when you file, again, you'll be taxed at the appropriate rate for your bracket, and refunded any over-withholding (federally). I can't tell you about California though.
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Jan 13, 2016 09:38
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So, I'm in an educational program that gets reimbursed by my employer after grades come in. If I paid for the education last year, and it won't be reimbursed until this year, can I claim the Lifetime Learning Credit for that expense? If I outlay the cash and am later reimbursed by my employer during the same year, could I claim the Lifetime Learning Credit anyway, since I am the one actually making the educational expense? I'm having a bit of trouble deciphering the language in Pub 970.
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Jan 13, 2016 18:56
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Another marriage + tax question after my last one: we both started new jobs a few months before we got married this year. When filling out W-4s for those jobs we both put ourselves down as "Single" which obviously changed when we got married. I know for a fact that I never updated my W-4 to say I was married and I'm willing to guess my wife never did either. Is that going to be an issue for our 2015 return?
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Jan 13, 2016 21:35
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C-Euro posted:Another marriage + tax question after my last one: we both started new jobs a few months before we got married this year. When filling out W-4s for those jobs we both put ourselves down as "Single" which obviously changed when we got married. I know for a fact that I never updated my W-4 to say I was married and I'm willing to guess my wife never did either. Is that going to be an issue for our 2015 return? Probably just going to have more withholding than you actually needed, might want to adjust that if you want to.
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Jan 14, 2016 01:45
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I feel like I'm missing something with the withholding calculator at https://apps.irs.gov/app/withholdingcalculator/index.jsp. I thought I made a data entry mistake last year that lead to an underpayment of about $800, but now I think something else is messed up or I'm fundamentally misunderstanding the calculator somehow. Simplifying things to just whats on my paycheck, I've got 57500 income, 17250 401k, 2500 HSA. Putting these into the calculator it tells me to use "1" withholding allowance which is $158 every 2 weeks. My paycheck which came today with "1" withholding only took $138. Also, it tells me I'll have a tax bill of $3,650. With a taxable income of $31450 (57500-17259-2500-6300), I should expect a tax bill more like $4250 right? The IRS number seems to indicate a taxable income in the $27500 range 2 questions: 1) Why is the IRS withholding calculator 15% off from whats actually being withheld 2) Why is the IRS withholding calculator predicting a significantly lower tax bill than form 1040. The takeaway here for me might just be to do my planning on the actual 1040 instead of calculators and set withholding allowances at like 5 with a flat extra that I calculate. Xenoborg fucked around with this message at 04:55 on Jan 14, 2016 |
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Jan 14, 2016 04:51
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Not a Children posted:So, I'm in an educational program that gets reimbursed by my employer after grades come in. If I paid for the education last year, and it won't be reimbursed until this year, can I claim the Lifetime Learning Credit for that expense? Over the long term you'll have to reduce your lifetime learning expenses (or tuition and fees deduction) by the amounts that your employer reimbursed you. If you take the credit (or deduction) and then later your employer reimburses for those expenses, you'll have to recalculate the credit based on the reduced expense account and pay back any tax benefit you got from the reimbursed expenses. Long story short, if you know you're getting reimbursed, you'd just be making a bunch more work for yourself to take the credit.
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Jan 14, 2016 05:24
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Hadlock posted:I've lived in Texas my entire adult life, except for December of this year (and forever, moving forward) where I am now in California. Texas does not have state income tax. California does. I am freaking out about this. My salary mostly doubled and I made as much in December 2015 as I made in the first quarter of 2015 at my old job. Lots of new rules do/don't apply to me. And state income taxes are a thing now. I can't comment on too much of this as I work on the East Coast except to note that oh MAN not only did you move from a no state income tax location, you moved to the state with the most complicated state income tax system to my knowledge. I would recommend a professional to be safe here unless you are REALLY comfortable with the CA forms (in order to avoid breaking my poor manager's heart, I feel obliged to put in a shout out for H&R Block in that regard even if you aren't in my district  ). Also, states can only tax income earned either working or otherwise earned in said state, or money earned while living in said state; if you have income reported as a year round figure (like bank interest or the like) you generally prorate those (i.e. work out the actual ratio of income earned in one place vs the other) to work out the number. So in your case probably only the money earned in December counts for CA. As for the relocation expenses, since you moved as part of getting a new job there is a moving expenses deduction on the federal return, check Form 3903 for details. Again, can't answer for California, since I'm not trained or registered for there. Can't really answer your bonus question because I've never run into it myself; I seem to recall they have to withhold tax at a higher rate than your salary because it is "supplemental income" (though I thought that rate was 25%?) but it just adds into your income like normal for actual taxes so it's not actually taxed differently than regular wages in the end. I'd just as soon you not take my word for it though until I double-check with a more experienced person in my office to make sure that's correct. If I'm right though, the extra withholding on the bonus income will just increase your federal refund a bunch when it's taxed at the right amount for your bracket (which, if it is $65K total income, is much less than 39%).EDIT: Yep, checked at work with our resident twenty year veteran preparer, they just withhold at the higher percentage for the bonus, the final tax on it is just the same as any other income. So you'll get the excess withholding back when you do your taxes this year. C-Euro posted:Another marriage + tax question after my last one: we both started new jobs a few months before we got married this year. When filling out W-4s for those jobs we both put ourselves down as "Single" which obviously changed when we got married. I know for a fact that I never updated my W-4 to say I was married and I'm willing to guess my wife never did either. Is that going to be an issue for our 2015 return? Single vs. married on the W-4 just affects your withholding; marking "married" reduces the withholding rate. It's not actually required to choose the married withholding rate even if you are married, many married people use single to withhold extra money for various reasons. I'd just look at your refund vs. your take home pay; if your refund is really big you can make the switch and get less withheld. Xenoborg posted:The takeaway here for me might just be to do my planning on the actual 1040 instead of calculators and set withholding allowances at like 5 with a flat extra that I calculate. Speaking from personal experience, yeah I'm terribly annoyed working with the whole "withholding allowance" thing on the W-4. Sure it's fairly good at setting the correct withholding for most folks just based on a few questions, but when the withholding ISN'T set correctly I often have math headaches trying to work out the exact withholding to recommend to a client in a way that translates correctly to a W-4. I believe the usual rule of thumb is each allowance effectively assumes a reduction of the exemption amount ($4000 for this year) from your taxable income, hence why your W-4 has you take an allowance for each person claimed on your return (since, sure enough, each one reduces your taxable income by their exemption value) and a couple other things are treated as de facto reducing your income by an exemption amount as well. Worst case scenario, you can just take the amount you were off by, divide it by the number of paychecks you'll have left in the year when your new W-4 kicks in with your employer, and just add that appropriate amount as a set figure on line 6 of the W-4 to withhold extra. Do try to work out withholding to ensure you have a cushion though; by design you're supposed to over-withhold more than the tax on your actual salary just to cover all the little incidentals where there is no withholding. MadDogMike fucked around with this message at 04:06 on Jan 15, 2016 |
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Jan 14, 2016 05:38
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Xenoborg posted:Also, it tells me I'll have a tax bill of $3,650. With a taxable income of $31450 (57500-17259-2500-6300), I should expect a tax bill more like $4250 right? The IRS number seems to indicate a taxable income in the $27500 range You forgot to subtract your personal exemption ($4000 for 2015, $4050 for 2016), unless you're someone's dependent and they're claiming your exemption, in which case, you didn't input that correctly into the withholding calculator.
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Jan 14, 2016 14:01
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Ancillary Character posted:You forgot to subtract your personal exemption ($4000 for 2015, $4050 for 2016), unless you're someone's dependent and they're claiming your exemption, in which case, you didn't input that correctly into the withholding calculator. You're right I glossed over the exemption section of the 1040 thinking it didn't not apply, forgot about personal exemption. The calculator was taking it into account. There is still the lingering question of why a withholding of one produced a different amount on my paycheck and the calculator though. I can just fix that with a flat addition though.
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Jan 14, 2016 14:38
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It is most likely due to other pre tax items, you just said 401k and HSA but do you pay for health insurance, transit, other insurances? These all bring your taxable income down.
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Jan 14, 2016 15:27
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I was booted out of my residence, through no fault of my own, and because of rent control the company was forced to pay me a lump sum. Is this sum taxable as income? I went looking through the forms and it seems that unless something is explicitly stated as exempt it is treated as income. Since I couldn't find any mention of this kind of thing I assume it is income and therefore subject to tax. Did I miss something? Is there anything more concrete than "you didn't find it in the 1000 pages, pay up"?
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Jan 14, 2016 17:27
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Boot and Rally posted:I was booted out of my residence, through no fault of my own, and because of rent control the company was forced to pay me a lump sum. Is this sum taxable as income? I went looking through the forms and it seems that unless something is explicitly stated as exempt it is treated as income. Since I couldn't find any mention of this kind of thing I assume it is income and therefore subject to tax. Did I miss something? Is there anything more concrete than "you didn't find it in the 1000 pages, pay up"? Yes, it's income.
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Jan 15, 2016 00:50
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