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Konstantin posted:Yeah, Enron actively encouraged employees to put a significant percentage of their savings into Enron stock, which didn't work out too well when the whole company collapsed due to massive accounting fraud. While that's certainly an outside example, it's far from the only or most likely thing to go wrong. The common scenario is that your company or the sector your company is in starts slowing and having problems so your investments tank right about when they're laying you off. Not to mention that most people don't have enough investible assets to be holding individual stocks (sanely).
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Jan 13, 2019 16:09
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Motronic posted:While that's certainly an outside example, it's far from the only or most likely thing to go wrong. The common scenario is that your company or the sector your company is in starts slowing and having problems so your investments tank right about when they're laying you off. One of the administrators at my MBA program sunsetted her long and productive career in private industry to go into academics with their golden years comfortably assured... With 80% of her retirement holdings in GE stock. Big oof from me, dogg.
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Jan 13, 2019 17:18
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why would you even remotely consider that a good idea, regardless of what stock it was
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Jan 13, 2019 17:32
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It depends. In my situation since my company doesn’t have any look back period, if I sell my shares once they’re deposited in my account I’m likely making or losing less than $100. I’d rather pay an extra $10ish in taxes than risk holding my firm’s stock for over a year. If you had some sort of multi-year lookback period where you might have thousands in capital gains, it might be worth it. But even then, it’s not exactly a clear cut choice. Here’s what I did last year if you want a point of reference. Fair warning though, I’m not a tax expert or anything. My company lists the ESPP 15% discount on my W-2 under code V. That number is included in my total income. On my schedule D, I put in the numbers from my 1099 and a cost basis adjustment to increase the cost basis by the amount of my discount (since that discount is already included in my ordinary income).
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Jan 13, 2019 18:20
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Motronic posted:You are being given 15% (or more if there is a lookback). Being taxed for this difference (because it is income) is normal, and bring your costs basis up to the stock price. This is the same as being taxed immediately on the entire share value for an RSU that vests. My company went private at something like a 40-50% price premium. That helped reinforce bad behavior for the working class employees who participated in and left all shares in the ESPP... Initio posted:It depends. In my situation since my company doesn’t have any look back period, if I sell my shares once they’re deposited in my account I’m likely making or losing less than $100. I’d rather pay an extra $10ish in taxes than risk holding my firm’s stock for over a year. Initio posted:Here’s what I did last year if you want a point of reference. Fair warning though, I’m not a tax expert or anything. *Also not a tax expert, but I read the instructions and some posts online and it seemed like this was the right way. TurboTax may have said to do this too, I feel like it asked all the needed questions... It's been a few years and we're now private so I don't deal with it anymore.
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Jan 13, 2019 23:09
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Motronic posted:But I'm pretty sure I've said many times what I think about holding stock in the company you're getting your paycheck from unless you're already quite well into FU money territory.
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Jan 14, 2019 00:43
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Quick tax question. My mother passed away earlier this week. Would I need to file her 2018 taxes as normal then file her 2019 as deceased or can I file her 2018 as deceased since I don't think she worked more than 1 week in 2019 before going into the hospital.
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Jan 17, 2019 23:37
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Irritated Goat posted:Quick tax question. My mother passed away earlier this week. Would I need to file her 2018 taxes as normal then file her 2019 as deceased or can I file her 2018 as deceased since I don't think she worked more than 1 week in 2019 before going into the hospital.
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Jan 17, 2019 23:41
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Is it a single or joint return? You need to mark that the taxpayer died in 2019 when you file their 2018 return (that you're filing as the estate). I ran into this when my dad died in February 2017, I had misfiled when filing his and my mom's joint tax return and I created a whole buncha problems for myself. Fortunately the standalone tax softwares should ask you if the taxpayer died during the previous or current year.
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Jan 18, 2019 02:14
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This is a small potatoes, wage taxation question, but cross posting as someone here might know more than the cspam crowd: Quick personal tax crisis update: both my and my wife's employer used an assumed $0.00 for spouse earnings when deducting for "married, filing jointly". Meaning our payroll deductions were set up as though our household income was roughly half of what it actually is. Is "married, filing jointly" a huge tax trap that I just never heard about? We/I literally had a tax refund every year until tax2017 when we suddenly got a big tax bill once our W2s came in. Is that when the withholding fuckery started?
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Jan 18, 2019 17:39
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JohnnySavs posted:This is a small potatoes, wage taxation question, but cross posting as someone here might know more than the cspam crowd: Hoodwinker fucked around with this message at 17:52 on Jan 18, 2019 |
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Jan 18, 2019 17:49
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I've seen some employers give an option of "Married, but withhold as Single" or just let you pick your own amounts/allowances ("0" is the highest withholding option) But yea, what Hood said, just do some napkin math about what your tax bill will be and see how far off you are with just your withholding. e: Also, from the few returns I've seen so far it looks like a lot of people have less withholding proportional to their tax bill this year, so you're not alone I guess that's comforting right??!!!
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Jan 18, 2019 18:35
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It's not that either employer withheld $0. I had withholdings as though I was filing MFJ with a household income of my salary $X, and she had withholdings assuming the same with her salary $Y. Of course with an actual earnings of $X+$Y there's a lot of marginal income in the 22%+ bracket that wasn't accounted for.
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Jan 18, 2019 18:36
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JohnnySavs posted:It's not that either employer withheld $0. I had withholdings as though I was filing MFJ with a household income of my salary $X, and she had withholdings assuming the same with her salary $Y. Of course with an actual earnings of $X+$Y there's a lot of marginal income in the 22%+ bracket that wasn't accounted for. Edit: A while ago I made a template version of my personal finance tracking sheet which I can disseminate to goons in need in your very circumstances!!! Here it is. Make a copy of it and go nuts. The withholding per paycheck amount will be a little off on compared to what you see on your actual paycheck if you have income beyond your standard wages, for instance a single annual bonus. This is fine. The purpose of this is to allow you to put yourself in a ballpark position. The sheet assumes you'll be marking MFJ on your W4 if you select "Married" at the top. Hoodwinker fucked around with this message at 18:51 on Jan 18, 2019 |
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Jan 18, 2019 18:46
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Hoodwinker posted:Oh I see. Yeah, that does change the calculus, but only a bit. The resolution is still the same: it's up to you to ensure that the amount you're withholding is the proper amount to meet your tax liability on a given year. This is part of why the W4 has instructions for handling a two-income household and how to calculate the withholding for that. Simply saying MFJ by itself will assume that each spouse is earning $0, like you said. You can either use the worksheet or derive your own method of calculating your proper withholding amount, but the burden still remains on you. It's a bummer to find out this way. My condolences on that. Yep, ultimately it's on me, but it's still odd that doing the same thing for a decade has suddenly switched tax time from refund to bill. Has that "$0 spouse earnings" assumption always been the case, or is it more recent?
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Jan 18, 2019 18:55
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JohnnySavs posted:Yep, ultimately it's on me, but it's still odd that doing the same thing for a decade has suddenly switched tax time from refund to bill. Has that "$0 spouse earnings" assumption always been the case, or is it more recent?
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Jan 18, 2019 18:57
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JohnnySavs posted:Yep, ultimately it's on me, but it's still odd that doing the same thing for a decade has suddenly switched tax time from refund to bill. Has that "$0 spouse earnings" assumption always been the case, or is it more recent? It has been this way forever, and right on the W4 it says: Two-Earners/Multiple Jobs Worksheet Complete this worksheet if you have more than one job at a time or are married filing jointly and have a working spouse. If you don’t complete this worksheet, you might have too little tax withheld. If so, you will owe tax when you file your tax return and might be subject to a penalty. Figure the total number of allowances you’re entitled to claim and any additional amount of tax to withhold on all jobs using worksheets from only one Form W-4. Claim all allowances on the W-4 that you or your spouse file for the highest paying job in your family and claim zero allowances on Forms W-4 filed for all other jobs. For example, if you earn $60,000 per year and your spouse earns $20,000, you should complete the worksheets to determine what to enter on lines 5 and 6 of your Form W-4, and your spouse should enter zero (“-0-”) on lines 5 and 6 of his or her Form W-4. See Pub. 505 for details. Another option is to use the calculator at https://www.irs.gov/W4App to make your withholding more accurate. Tip: If you have a working spouse and your incomes are similar, you can check the “Married, but withhold at higher Single rate” box instead of using this worksheet. If you choose this option, then each spouse should fill out the Personal Allowances Worksheet and check the “Married, but withhold at higher Single rate” box on Form W-4, but only one spouse should claim any allowances for credits or fill out the Deductions, Adjustments, and Additional Income Worksheet.
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Jan 18, 2019 19:02
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Alright, so just boo-hoo I'm a dumb middle class American. Thanks for the info. Now to maybe get HR to explain this to everyone, 'cause I'm not the only one in this boat.
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Jan 18, 2019 19:27
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Yeah basically the only time MFJ isn't absolutely worth it tax wise is if you have two earners that are kind of right below a bracket increase, so combining makes some of the combined income above that line since it's not a straight 2x. The tax system was written to incentivize women staying home and not earning any income and taking care of the kids.
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Jan 18, 2019 20:09
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JohnnySavs posted:Yep, ultimately it's on me, but it's still odd that doing the same thing for a decade has suddenly switched tax time from refund to bill. Has that "$0 spouse earnings" assumption always been the case, or is it more recent? That’s the way it’s always been because he assumption behind the law has always been “man works, wife stays home and squirts our babies.” In school we actually learned it as the “marriage penalty,” filing joint with two working spouses. black.lion posted:
I’ve been expecting/dreading this for months. There were reports in the middle of the year that the withholding tables were low. Good luck to all my tax prep guys when you’ve got a MAGA gently caress in your office mad at you for their tax bill instead of the new law.
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Jan 19, 2019 07:28
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Building out the spreadsheet I did and using it led me to doing a fuckton of additional withholding in order to not be below my tax liability, so I'm not surprised to hear about people getting bit.
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Jan 19, 2019 07:35
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I'm not sure if this is a tax or a payroll question exactly, but hopefully someone can help. My partner and I are planning on having a second child this year. If we do, I'm calculating that the government will actually owe us money for the year:
This of course assumes everything goes to plan. I know I can always zero out withholding now, but that would leave the possibility of things not going according to plan and us ending up owing interest/penalties to the IRS (on the other hand, without the second child tax credit, we'd still only owe the government about $1,000. Is this even enough to trigger penalties/interest if it's paid late?). If things do go to plan, can I get whatever I've had withheld on my taxes during the year up to that point "refunded" through payroll in advance of filing the following year's tax return? The answer affects how we'll save for hospital bills over the course of the year.
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Jan 20, 2019 17:35
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I'm not a fancy tax accountant person, but I have a REALLY hard time a household making $90k with 2 kids would have zero tax liability.
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Jan 20, 2019 19:34
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KillHour posted:I'm not a fancy tax accountant person, but I have a REALLY hard time a household making $90k with 2 kids would have zero tax liability. Ronald McReagan posted:After figuring in the saver's credit (2 x $200) and child tax credits (2 x $2,000), this results in a net tax liability of about -$1,000 (which I assume we'd get the full benefit of since the child tax credit is refundable up to $1,400 per child).
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Jan 20, 2019 19:55
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Should I be expecting any forms if I made HSA contributions, but not deductions in 2018? (I know there's a form sent if you took money out.)
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Jan 20, 2019 23:59
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Small White Dragon posted:Should I be expecting any forms if I made HSA contributions, but not deductions in 2018? (I know there's a form sent if you took money out.) Yes, but the HSA trustee isn't required to send it until May because you can still contribute for 2018 until April 15. You don't need to have it to file. Any contributions you made through payroll deductions (and any amounts that your employer provided) should be reported with code W in box 12 of your W-2.
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Jan 21, 2019 00:48
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Droo posted:I'm not sure about exactly what order the refundable/non refundable credits go in so not sure if you would get money back or not, but in your situation I would be funding a roth IRA instead of a traditional IRA because a roth is a better choice than traditional at 12%. I didn't think about the order in which refundable/nonrefundable are applied. In the worst case scenario, I guess this would mean zero tax liability (I'd burn through all of the first credit and ~$100 more than the refundable portion of the second credit before hitting zero). Still wondering whether it's possible to recover withholding before filing the 2019 return though. As for Roth/traditional, I go back and forth on it. I plan on living within the current 10% bracket during retirement (in 10-15 years), so it's kind of a bird-in-the-hand calculation for me.
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Jan 21, 2019 01:19
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Ronald McReagan posted:I didn't think about the order in which refundable/nonrefundable are applied. In the worst case scenario, I guess this would mean zero tax liability (I'd burn through all of the first credit and ~$100 more than the refundable portion of the second credit before hitting zero). Still wondering whether it's possible to recover withholding before filing the 2019 return though.
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Jan 21, 2019 08:28
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Ronald McReagan posted:I didn't think about the order in which refundable/nonrefundable are applied. In the worst case scenario, I guess this would mean zero tax liability (I'd burn through all of the first credit and ~$100 more than the refundable portion of the second credit before hitting zero). Still wondering whether it's possible to recover withholding before filing the 2019 return though. If you're not investing your tax savings in a taxable account, then a Roth IRA effectively allows you to contribute more than a Traditional account.
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Jan 21, 2019 19:39
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Can any of you tax pros give any insight as to how you staff during the season? I'm a first year VITA/TCE volunteer and our site coordinator hasn't released the schedule yet, so apart from late in the season I don't know relative busy times. Do you anticipate any of it changing because of the shutdown?
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Jan 21, 2019 22:12
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Ancillary Character posted:If you're not investing your tax savings in a taxable account, then a Roth IRA effectively allows you to contribute more than a Traditional account. I am, we save another ~$12k/year in a taxable account, which tax-gain harvesting makes pretty much as good as a Roth.
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Jan 22, 2019 02:00
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I have a family member that started receiving SSI for disability in 2018. I am the designated payee, and they live with us/rent a room and I use the SSI take care of their needs, rent, transportation, etc. Where do I find the information that designates what my tax filing requirements are? Like, do I have to claim what I use for their rent/living expenses as income on my taxes? My Google-fu is weak and I can't find anything that appears relevant. I see info on determining rent, filing/not filing their taxes (haven't got their 1099-SSA yet), but no info on what I need to do personally on my taxes.
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Jan 22, 2019 04:51
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Fire Storm posted:I have a family member that started receiving SSI for disability in 2018. I am the designated payee, and they live with us/rent a room and I use the SSI take care of their needs, rent, transportation, etc. There is an IRS pub or faq about related party rentals. Use that as your keyword in Google.
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Jan 22, 2019 07:16
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BonerGhost posted:Can any of you tax pros give any insight as to how you staff during the season? I'm a first year VITA/TCE volunteer and our site coordinator hasn't released the schedule yet, so apart from late in the season I don't know relative busy times. Do you anticipate any of it changing because of the shutdown? I've run a community-based free tax program for the past 5 years. For VITA/TCE, sites are extremely busy starting at the end of January as soon as enough taxpayers get their documents. The strong majority of taxpayers accessing a free tax site expect to receive a refund and will file as soon as possible to get it quickly. When we operated as first-come-first-served, we would be swamped as soon as we opened and through mid-March, then we have a lull and sites would sometimes close early. Traffic would pick up again in April, but we never saw January/February level traffic even right before the deadline. I don't expect you to be any less busy because of the shutdown, but I would not be surprised if it took a little longer to process everyone's returns and issue refunds.
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Jan 22, 2019 13:59
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Droo posted:I'm not sure about exactly what order the refundable/non refundable credits go in so not sure if you would get money back or not, Jumping back up to this, the nonrefundable credits are applied before refundable credits. You see it walking through the 1040: nonrefundable credits are applied to reduce your income tax, then any special or penalty taxes (like SE tax, the IRA early distribution penalty, etc) are added, then refundable credits are added to your withholding and estimated payments to apply against your total tax liability and constitute your refund. So you might not get all the benefit of the nonrefundable credits if you don't have enough income tax liability, but they are applied in the order you would want them to be.
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Jan 22, 2019 14:07
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Ronald McReagan posted:This of course assumes everything goes to plan. I know I can always zero out withholding now, but that would leave the possibility of things not going according to plan and us ending up owing interest/penalties to the IRS (on the other hand, without the second child tax credit, we'd still only owe the government about $1,000. Is this even enough to trigger penalties/interest if it's paid late?). If things do go to plan, can I get whatever I've had withheld on my taxes during the year up to that point "refunded" through payroll in advance of filing the following year's tax return? The answer affects how we'll save for hospital bills over the course of the year. There are three ways to avoid the underpayment penalty: 1. Withhold/pay estimated taxes of at least as much as your prior-year tax liability 2. Withhold/pay estimated taxes of at least 90% of your current-year tax liability (this was lowered to 85% for 2018) 3. Owe less than $1000 on your return So owing "about $1000" might be ok and might not be ok depending on which side of $1000 you end up landing on. I am not aware of any mechanism for you to get your withholdings back before filling a return. Your employer is required to send that money to the government on a regular basis, so you can't just ask for it back from payroll. You can change your withholding at any time during the year, so you could wait until you know that you are pregnant and then adjust so no more is withheld. Note also that a child has to be born before the end of the year to provide tax benefits, so time is of the essence to get that process started.
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Jan 22, 2019 14:31
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urnisme posted:
RIP to the parents whose kid is born late, and comes out after midnight on January 1 of the new year.
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Jan 22, 2019 15:27
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BonerGhost posted:Can any of you tax pros give any insight as to how you staff during the season? I'm a first year VITA/TCE volunteer and our site coordinator hasn't released the schedule yet, so apart from late in the season I don't know relative busy times. Do you anticipate any of it changing because of the shutdown? Here we usually talk in terms of “First Peak” and “Second Peak”. First Peak hits at start of February when the W-2s are definitely in, so we get a big swarm then. Dies down somewhat at end of February then boosts up again around end of March to April 15th. This is kind of a generalization mind you, and one that varies on location/typical clients. Offices in lower income areas (where most income is W-2 only) go crazy at the start then almost die out after that, and last year for me at least I didn’t see much of a drop between the two peaks. This year I’ve actually seen more returns than usual in January, though part of that is I’m a CAA who handles ITIN applications. The shutdown doesn’t affect us directly though since we do the return and just store it on our servers until the IRS opens.
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Jan 22, 2019 21:33
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BonerGhost posted:Can any of you tax pros give any insight as to how you staff during the season? I'm a first year VITA/TCE volunteer and our site coordinator hasn't released the schedule yet, so apart from late in the season I don't know relative busy times. Do you anticipate any of it changing because of the shutdown? 
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Jan 23, 2019 02:48
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My girlfriend and I are getting married this year ( ) and I was curious if there were any tax-related implications we should be aware of and start preparing for now. She owns a condo (with a modest mortgage) and we're doing our taxes together by hand this year so we both have full and accurate info on everything. Is there anything in particular we need to prepare ourselves for prior to getting married on the tax front?
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Jan 23, 2019 19:49
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