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Thanks sullat- in case it's not clear, my area of knowledge is actually pretty limited. I just see what crosses my Publication 3498 is the official audit process description. It's semi-legible, though it's mostly focused on the appeals process (we give it to people at the end of an office audit). Don't worry though, I have a much more convenient resource for you. Discendo Vox fucked around with this message at 05:53 on Feb 5, 2020 |
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Feb 5, 2020 05:45
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One thing I would note, if you have to correct a federal return be sure to also review any state returns, because they may need amending too. They do talk to each other, so changes to an IRS return will eventually come to the attention of the state division of revenue; better to fix both at once if needed (which may take a state amendment even if you don't need to send one to the IRS).
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Feb 5, 2020 06:56
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I'm 95% sure I know the answer to this, but I wanted to double check: We currently have 1 kid, and will have another in a few months. We currently use a Dependent Care FSA for #1's day care and fully fund it, so that's $5k. We never looked at the Child Care Tax Credit before because it maxed out at $3,000 for 1 kid. But now with 2 kids it maxes out at $6,000. So I know that we can't double dip the tax credit with the FSA. However, we can still claim the $1,000 difference between the FSA and the tax credit max, right?
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Feb 5, 2020 16:13
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DaveSauce posted:I'm 95% sure I know the answer to this, but I wanted to double check: $1000 * whatever decimal amount you use from line 8, I'm going to guess .20, but double check yourself.
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Feb 5, 2020 18:39
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sullat posted:$1000 * whatever decimal amount you use from line 8, I'm going to guess .20, but double check yourself. I'm pretty sure it's 20% for us, but my main concern was making sure that I could even use that $1,000 worth of space. Thanks!
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Feb 5, 2020 19:13
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DaveSauce posted:I'm pretty sure it's 20% for us, but my main concern was making sure that I could even use that $1,000 worth of space. Thanks! I am in the same situation and that is what H&R Block's software is telling me to do.
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Feb 6, 2020 04:36
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I did a run through of my taxes with Turbotax and I'm now doing second pass with H&R Block to see if the numbers match up and I'm running into a weird situation. I don't live in the US, all of my income is from my non-US self-employed work. H&R block is adding the QBI deduction and TurboTax expressly excluded it because my income is non-US. I'm not one to say no to free money, but I think TurboTax is right here?
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Feb 7, 2020 00:05
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I've never heard of someone shooting and hanging themselves at the same time before.
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Feb 7, 2020 00:50
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Discendo Vox posted:I've never heard of someone shooting and hanging themselves at the same time before. Is this your way of saying that TurboTax and HR Block suck?
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Feb 7, 2020 00:58
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Ur Getting Fatter posted:I did a run through of my taxes with Turbotax and I'm now doing second pass with H&R Block to see if the numbers match up and I'm running into a weird situation. Qualified business income must be effectively connected to the United States, so your foreign self-employment likely does not qualify. And in that case you would be giving up your foreign earned income exemption/foreign tax credits.
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Feb 7, 2020 01:48
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Ur Getting Fatter posted:Is this your way of saying that TurboTax and HR Block suck? I don't know them in any detail, though they both have their own ways of steering people wrong. Mostly I just loathe the companies behind them. Try the instructions on the irs website, it's got a bunch of QBI materials.
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Feb 7, 2020 05:09
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Ur Getting Fatter posted:I did a run through of my taxes with Turbotax and I'm now doing second pass with H&R Block to see if the numbers match up and I'm running into a weird situation. Qbi is no dice on non us income.
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Feb 8, 2020 04:00
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Now that the IRS gets cost basis for stocks, do they still send out CP2000 letters that assume your cost basis was $0 if you leave a transaction off your return?
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Feb 8, 2020 15:21
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smackfu posted:Now that the IRS gets cost basis for stocks, do they still send out CP2000 letters that assume your cost basis was $0 if you leave a transaction off your return? Cost basis reporting started January 2011, and not for everything at once, so lots of folks have stocks and such with no reported basis. It’ll be a long while before that stops being the case, and even then I’m not sure basis reporting takes into account things like step up basis properly. Besides, even when stocks stop being a problem we’ll still always have the good ol’ “home realtor decides to issue a late 1099-S on the sale of primary home and the IRS thinks you sold a $0 home for several hundred thousand and no exclusion, enjoy the heart attack bill!”. At least answering these things can be hilarious when it turns out the sale in question was actually an improperly reported capital loss; story I keep mentioning is the client with a letter for $95,000 that actually deserved a $1000 additional refund. Commented to the preparer with that one their poor client probably got whiplash when they were told what actually happened.
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Feb 8, 2020 17:30
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So I filed my taxes and reported misc. income my wife made, but then lo and behold, she informed me after we filed that she got 1099-Misc forms for that income. Do I need to ammend my return with those 1099's or am I in the clear since I already reported that income?
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Feb 9, 2020 16:24
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I've put everything into FreetaxUSA, and it thinks I'm owed almost $1k on my Colorado state tax. But CO's own online filing site believes I owe them $2k. How could this discrepancy exist/what could I have entered wrong? (edit) I missed CO withholding on one of my 1099R's on CO's site, but it's still at $1k owed so still $2k discrepancy to account for (edit again) Nevermind, the instructions on CO's site are bad, I used the wrong number from the 1040  matched up perfectly once I fixed it at least
Ciaphas fucked around with this message at 19:18 on Feb 9, 2020 |
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Feb 9, 2020 18:05
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So I have maybe a dumb question. If I take out the full 2700 out of my paycheck per year to go toward an HSA or medical card am I allowed to do anything else with those medical expenses on my taxes or have I already gotten everything I can out of it by having that specific money not taxed by putting it into the HSA in the first place??
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Feb 9, 2020 23:21
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Philosopher King posted:So I have maybe a dumb question. If I take out the full 2700 out of my paycheck per year to go toward an HSA or medical card am I allowed to do anything else with those medical expenses on my taxes or have I already gotten everything I can out of it by having that specific money not taxed by putting it into the HSA in the first place?? You kinda phrased that funny, so to be clear: making the contribution and taking a distribution are two different events. Making a contribution has no bearing on what you're asking. It's a contribution, nothing more. The distributions, however, are where the issue comes in. So if you pull money OUT of your HSA/etc. to pay for medical expenses, you cannot double dip and claim those same medical expenses as deductions on your taxes. And that's for the very reason you stated; you've already paid for them with pre-tax money. So if you're using that HSA money to pay for stuff, then you're correct. However if you just leave the money in your account, then you can still take a tax deduction for any medical expenses you incur. Something to note is that you can only deduct medical expenses ABOVE a certain percentage of your AGI... something like 7.5% I think.
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Feb 10, 2020 02:02
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You can't double dip - if a medical expense is paid out of HSA funds, as far as the feds are concerned it can't be deducted. The HSA allows you to reduce your taxable income up front, and does so on a much lower dollar amount than needed to itemize your medical expenses.
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Feb 10, 2020 02:03
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DaveSauce posted:You kinda phrased that funny, so to be clear: making the contribution and taking a distribution are two different events. How would this work when you can reimburse yourself at any point down the road? If I take the tax benefit of spending 10% of my income now, and then reimburse myself 30 years later am I supposed to file an amendment?
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Feb 10, 2020 02:08
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tumblr hype man posted:How would this work when you can reimburse yourself at any point down the road? If I take the tax benefit of spending 10% of my income now, and then reimburse myself 30 years later am I supposed to file an amendment? No you aren't supposed to reimburse for things you already took a distribution on. It's tax fraud. You're really exceedingly unlikely to get caught though.
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Feb 10, 2020 02:19
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H110Hawk posted:No you aren't supposed to reimburse for things you already took a distribution on. It's tax fraud. You're really exceedingly unlikely to get caught though. You mean deduction not distribution right? I don't have an HSA anyway, but what an easily cheated system.
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Feb 10, 2020 02:22
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Handsome Ralph posted:So I filed my taxes and reported misc. income my wife made, but then lo and behold, she informed me after we filed that she got 1099-Misc forms for that income. To clarify, are you asking if you need to file a 1099-MISC with your tax return as someone who received that income? Because that's not what that form is for.
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Feb 10, 2020 02:44
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Discendo Vox posted:To clarify, are you asking if you need to file a 1099-MISC with your tax return as someone who received that income? Because that's not what that form is for. I think so? I reported the income on my return, I just didn't report it using the 1099 (using H&R block software), I instead looked back on my budget/bank statements to verify how much she earned through that side job. I just put it in as miscellaneous unreported income.
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Feb 10, 2020 02:50
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tumblr hype man posted:You mean deduction not distribution right? I don't have an HSA anyway, but what an easily cheated system. Today you deposit $1000 into your hsa. That is legally deducted from your agi, making it pre-tax money. You incur $10,000 in expenses on $50k of income and deduct the amount over 10% of your income from your agi ($5k). This makes $5k of it pretax. In 30 years you have $10k in your hsa. You can legally reimburse the remaining $5k as its the only amount that was still paid with post-tax money. That's it. To my understanding.
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Feb 10, 2020 02:52
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H110Hawk posted:Today you deposit $1000 into your hsa. That is legally deducted from your agi, making it pre-tax money. Makes sense, just seems like a super easy way to cheat although I suppose in the grand scheme of things it isn't much money and relies on you having a ton of medical expenses.
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Feb 10, 2020 03:07
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The only thing the IRS asks is for you to check a box affirming that you didn't use any HSA withdrawals for anything other than medical expenses... yes, it's very easy to abuse, but by that logic so is just about every part of tax filing.
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Feb 10, 2020 03:34
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Handsome Ralph posted:I think so? That should be fine, as long as your estimate was correct. You don't need to include 1099 Misc forms with your return. If your estimate was wrong than yeah, you would want to file an amended return.
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Feb 10, 2020 16:23
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A return being "accepted" by the IRS is totally meaningless, right? Just means "you didn't gently caress up your last-year AGI or your PIN"?
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Feb 10, 2020 22:43
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Ciaphas posted:A return being "accepted" by the IRS is totally meaningless, right? Just means "you didn't gently caress up your last-year AGI or your PIN"? There's a few other issues that the e-file system screens for, but yeah, it just means that the IRS has accepted your return and it is successfully filed. If there are any further problems the IRS will contact you by mail.
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Feb 10, 2020 23:17
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sullat posted:There's a few other issues that the e-file system screens for, but yeah, it just means that the IRS has accepted your return and it is successfully filed. If there are any further problems the IRS will contact you by mail. Thanks much. Two attempts (TaxAct and FreeTaxUSA, the latter which I actually filed with) got me the same CO state refund to the dollar; the other two were $50 off for reasons I couldn't work out. Hopefully the one I filed is accurate, I'm gonna be nervous about it for weeks 
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Feb 11, 2020 00:21
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Ciaphas posted:A return being "accepted" by the IRS is totally meaningless, right? Just means "you didn't gently caress up your last-year AGI or your PIN"? Or at least didn't get a reject for any of about fifty billion issues, some that will definitely leave you scratching your head when they come up (been getting weird random rejects in my area of "claiming child tax credit for child not under age 17" for kids who very much aren't that old and were filed without issue previously this year  ).Handsome Ralph posted:I think so? As long as the income was reported in the right place and matches the 1099-MISC information, it's no issue at all. Most of the point of the 1099-MISC is to prevent people taking payment "under the table", so if you're reporting it already you're in compliance with its function really. You're supposed to include income even without the reporting form on the return anyway. Though you mentioned it was reported as miscellaneous income; was it on a Schedule C or "other income"? Depending on the reporting of the 1099-MISC you may get dinged for using "other income" if like every drat source I see they just stick the income in box 7 whether or not it was regular enough to constitute business income; IRS figures you should be including it on a Schedule C/paying SE tax on it.
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Feb 11, 2020 08:51
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In September my wife rolled over a standard 401(k) from a previous employer to her Vanguard Roth IRA account. As far as we understood, that would mean that come tax time we’d own taxes on that rolled over amount, which we were/are prepared for. I handed off my tax documents off to our accountant and today they called back to let me know what I owe, which was considerably less than expected. After discussion we realized the difference was down to the rollover amount. I looked at the 1099-R we received in the mail and noticed it’s noted as (Box 7) Distribution code G rollover, and the taxable amount is listed as blank. The accountant is saying it’s a mistake in our favor and if they change it, we would not only owe the taxes on it (which we were prepared to owe), but also a 10% penalty for being under age 59.5. I thought that the 10% penalty was only if you took the money directly, or waited more than 60 days after getting the money before moving into another retirement account? The money was sent as a check to our house (but made out to Vanguard), which we then forwarded to Vanguard a day later. Vanguard deposited the amount into the Roth IRA account and never raised any flags. We never deposited any money from the rollover process to a personal bank account. I’m trying to figure out what I’m supposed to do here: 1. Do I leave it be based on the accountant’s advice that it’s a mistake in my favor, and I have the form to prove it? 2. Have the accountant change the form somehow to display with a corrected distribution code (which I think would be “2”), and pay the taxes owed? I’m just trying to do the right thing, and keep the man from kicking down my door / hitting me with potential punitive damages. Hoping I didn’t gently caress something up and cost myself a 10% penalty on top of normal taxes. I’m also surprised how adamant the accountant is that we should leave it be. They really are framing it as profiting off someone else’s mistake or paying a 10% added penalty. I don’t quite understand why there is no middle option between the two. For what it’s worth we’ve used the same guy for three years and he’s never seemed shady with anything in the past. Any thoughts Goons?
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Feb 12, 2020 00:20
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The Rev posted:In September my wife rolled over a standard 401(k) from a previous employer to her Vanguard Roth IRA account. As far as we understood, that would mean that come tax time we’d own taxes on that rolled over amount, which we were/are prepared for. G is correct. Did Vanguard know that the funds were Traditional and not Roth when you deposited them? The tax should be trivial to calculate - either you owe exactly $0 (trad->trad) or you owe your marginal rate as ordinary income. I think your accountant is loving up here, and that Vanguard didn't know you were doing a Trad->Roth conversion. I would call Vanguard and ask them about it, first. In theory the tax form comes from them for the conversion to Roth. Then once you know, I would talk to your accountant about it.
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Feb 12, 2020 00:37
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Is the "Taxable Amount Not Determined" box checked?
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Feb 12, 2020 00:45
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H110Hawk posted:G is correct. Did Vanguard know that the funds were Traditional and not Roth when you deposited them? The tax should be trivial to calculate - either you owe exactly $0 (trad->trad) or you owe your marginal rate as ordinary income. I think your accountant is loving up here, and that Vanguard didn't know you were doing a Trad->Roth conversion. I unfortunately don't remember if the original check explicitly mentioned that the funds were Traditional, though I thought I remembered seeing "401(k)" somewhere on there. I suppose I should have made a copy of what was sent over to Vanguard at the time. That being said the 1099-R I have now is not from Vanguard, it's from the previous employer that that we rolled the money over from. I never received a 1099-R from Vanguard and when I log into my wife's Vanguard Roth IRA account and go into the tax form center, there are no forms available for download. Should I get in contact with Vanguard and ask them to furnish a 1099-R for me/ask where there isn't one present for download currently? I appreciate your time and assistance, H110. Xenoborg posted:Is the "Taxable Amount Not Determined" box checked? No, that box is blank. Essentially the only boxes filled in are 1 (Gross Distribution), 2b (Total Distribution box has an X), 7 (Distribution Code = G), and 13 (state/Payer's State no.)
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Feb 12, 2020 01:18
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The Rev posted:I unfortunately don't remember if the original check explicitly mentioned that the funds were Traditional, though I thought I remembered seeing "401(k)" somewhere on there. I suppose I should have made a copy of what was sent over to Vanguard at the time. That being said the 1099-R I have now is not from Vanguard, it's from the previous employer that that we rolled the money over from. I never received a 1099-R from Vanguard and when I log into my wife's Vanguard Roth IRA account and go into the tax form center, there are no forms available for download. Should I get in contact with Vanguard and ask them to furnish a 1099-R for me/ask where there isn't one present for download currently? I appreciate your time and assistance, H110. My bet is on Vanguard assuming those were Roth funds that you deposited. You probably clicked right past something telling you about some responsibility something something. Once they know they were pre-tax dollars I imagine they will re-characterize it into Trad and say "that's it, and 2019 is correct", and the tax obligation might move into 2020 depending on exactly what they do and the rules around it. (I have no clue there.) Doesn't explain why your accountant isn't getting the right number.
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Feb 12, 2020 01:37
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I would not work with an accountant who says things like "mistake in your favor." Doing taxes is not Monopoly rules.
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Feb 12, 2020 02:17
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sale on Banksy art posted:I would not work with an accountant who says things like "mistake in your favor." Doing taxes is not Monopoly rules. US Income Tax Thread: Bank error in your favor! GO DIRECTLY TO JAIL.
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Feb 12, 2020 05:36
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Just double check that the funds went into your Roth. I’ve had multiple clients try to do the same thing as you but that the transfer of the traditional 401k actually went into a traditional IRA, not a Roth. So I’m basically asking “did you try turning off your computer and turning it on again?” but for taxes. If it went to a Roth the accountant can just recode the 1099-R with “2” instead of “G” and make it taxable. Secondly, it’s not a 10% penalty situation to convert.
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Feb 12, 2020 14:09
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