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Mr.Radar posted:I mailed in my tax forms at the beginning of March (to the California processing center) and the IRS still hasn't processed them (I haven't received my refund and the site to check my return status says they haven't received anything from me yet). Is their mail-in processing that backed up? Or should I assume my tax forms get lost in the mail somewhere and I need to send them in again? Should I request an extension? Quick update on this, I just got my refund yesterday  I didn't do anything, just waited a bit, and it eventually showed up.
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Jul 31, 2020 16:01
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Mr.Radar posted:Quick update on this, I just got my refund yesterday 
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Jul 31, 2020 18:24
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I have a question about 401k federal combined limit ($57k for me, I'm not that old yet.) I'm aiming to hit that without going over (by much, yay paperwork) and was trying to figure out how my 2019 matching true up is accounted, in 2019's limit or 2020's limit. Our plan offers the in-service rollover feature that is becoming more common for the "mega backdoor roth." I asked our benefits folks but figured it was worth double checking: "Although that amount was contributed this year, the amount should be allocated toward last year’s allowance. " So as I read this, for this year I need to go to: $57k - $19,500 - $1000 (Current True Up amount) - $3000 (Expected True Up in July 2021) = $33,500 in After Tax Max?
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Jul 31, 2020 22:41
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If the current true-up was for last year, you shouldn't subtract it from this year.
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Aug 1, 2020 18:49
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I'm investigating solar for my home and the SITC is obviously one of the big things everyone (sales people) talk about. I have learned it's a non-refundable credit, 26% for 2020. My understanding is that a tax credit is going to reduce my tax liability by some number, x. If x is greater than my tax liability I roll the rest to the next year. Here's my question. I'm married, we file jointly. My spouse usually gets a refund, thus I usually get a refund. Even though we paid more in taxes than we owe, that tax liability is still there. Taking the credit will increase our refund because more of what we paid is now in excess of our reduced liability, right? Basically, the credit will probably still become money in the bank even if we usually get a refund, right?
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Aug 9, 2020 07:31
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https://thumbs.gfycat.com/IcyRemorsefulAztecant-size_restricted.gif
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Aug 10, 2020 02:37
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Olothreutes posted:I have learned it's a non-refundable credit, 26% for 2020. My understanding is that a tax credit is going to reduce my tax liability by some number, x. If x is greater than my tax liability I roll the rest to the next year. Incorrect quote:Basically, the credit will probably still become money in the bank even if we usually get a refund, right? Yes, if it’s more than your tax liability for the year. The amount you’ve paid in has no effect on this.
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Aug 11, 2020 02:28
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Ungratek posted:Incorrect Any unused solar tax credit does roll over, what is incorrect about what he said? To clarify, say his credit comes to $7,000, his tax liability is $5,000 and his withholding is $4,500. The solar credit wipes out the tax so he gets all $,4,500of his withholding back, but there is still $2,000 left of the credit. That $2,000 is carried forward to next year and can be used against that years liability. Or reverse the liability and withholding numbers; without the credit he would get $500 back, with it he gets all $5,000 and has $2,500 in credit that rolls over to next year.
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Aug 11, 2020 18:45
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If someone had no tax liability in 2019 and is earning taxable income in 2020, the IRS says that estimated quarterly payments are not required. Does this mean that I'll owe roughly what I would otherwise pay quarterly at tax return time next year? My income is an educational stipend and not subject to the usual employer withholding.
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Aug 11, 2020 23:06
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There Bias Two posted:If someone had no tax liability in 2019 and is earning taxable income in 2020, the IRS says that estimated quarterly payments are not required. Does this mean that I'll owe roughly what I would otherwise pay quarterly at tax return time next year? My income is an educational stipend and not subject to the usual employer withholding.
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Aug 11, 2020 23:22
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Epi Lepi posted:Any unused solar tax credit does roll over, what is incorrect about what he said? Did he not say it was a non refundable credit?
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Aug 12, 2020 00:02
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Ungratek posted:Did he not say it was a non refundable credit? Yes, and it is correct. The withholding is a refundable credit and is taken into account after the non-refundable credits are taken into account. So the solar credit takes the tax to zero and the withholdings are refunded.
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Aug 12, 2020 00:07
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Ungratek posted:Did he not say it was a non refundable credit? In this case it is non-refundable, but any unused portion is specified to apply to the next tax year. I won't get that extra back in 2020 as dollars, but it will reduce my tax liability in 2021, which is what I said? Or at least it's what I meant to say. From here: If the tax credit exceeds my tax liability, will I get a refund? This is a nonrefundable tax credit, which means you will not get a tax refund for the amount of the tax credit that exceeds your tax liability.15 However, you can carry over any unused amount of tax credit to the next tax year. My question was based around a lack of understanding about terms like tax liability, and how my withholding interacts with said liability. I think I've got my answer now, though, thanks thread. Olothreutes fucked around with this message at 00:14 on Aug 12, 2020 |
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Aug 12, 2020 00:10
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Olothreutes posted:In this case it is non-refundable, but any unused portion is specified to apply to the next tax year. I won't get that extra back in 2020 as dollars, but it will reduce my tax liability in 2021, which is what I said? Or at least it's what I meant to say. yes and you could change your withholdings in 2021 to compensate
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Aug 12, 2020 00:11
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Well there you go! Thanks everyone!
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Aug 12, 2020 00:19
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Dik Hz posted:Yes. I was in this situation and that's exactly how it worked. Great, thanks!
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Aug 12, 2020 12:37
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Mr.Radar posted:Quick update on this, I just got my refund yesterday I just got my refund in the mail today as well. One small thing has me a bit confused, however. The refund check is for a small amount more (a little over  ) than I should have gotten back, according to the return I filed. I double checked my math, and can't find anything wrong (I did this before I filed, as well, of course). How do I proceed from here? I'd kind of like to know why the difference is there, small as it is. The IRS hasn't contacted me either way regarding my return, and this is the first time anything like this has happened to me.
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Aug 14, 2020 23:02
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Meaty Ore posted:I just got my refund in the mail today as well. The easiest way to check would be to get an account transcript for the tax year in question. You can call the IRS as well but the phone lines are pretty busy whereas if you're able to use the online transcript tool at IRS.gov under "Get my tax record" you can get that transcript immediately once you set up an account. Assuming it is credit interest, you'll get a 1099-G from the IRS next year for the additional amount and will have to report it as taxable income.
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Aug 14, 2020 23:23
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Peyote Panda posted:If the delay between the receipt of the return and the release of the refund is long enough, you may have gotten some credit interest on the refund. If there had been a change of the base refund amount due to an adjustment of the return in processing, you would have gotten a CP notice of some kind, though it is possible that one was sent and got lost in the mail. I mailed it in just prior to the normal April due date, so I'm guessing it's probably the credit interest you mentioned. I didn't know that was a thing, so thanks for the information. Also for letting me know it's taxable; that was going to be my next question.
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Aug 14, 2020 23:49
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Peyote Panda posted:If the delay between the receipt of the return and the release of the refund is long enough, you may have gotten some credit interest on the refund. The IRS calculates interest from April 15 until they pay the refund, as long as you file within 3 years of the original due date - just like they charge you interest from April 15 until you pay when you owe (except this year, the deadline for you to pay got pushed back to July 15. The IRS is still paying interest on refund back to April 15). They were paying 5% annual interest until June 30 and 3% since.
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Aug 15, 2020 01:17
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Somehow I don’t think I’m going to get interest on my Virginia state tax return which I mailed 2 full months ago and still doesn’t turn up when I check the status on their website. 
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Aug 15, 2020 01:40
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Josh Lyman posted:Somehow I don’t think I’m going to get interest on my Virginia state tax return which I mailed 2 full months ago and still doesn’t turn up when I check the status on their website. You might have to argue about when you filed it, but it looks like you'd eventually get some interest: https://law.lis.virginia.gov/admincode/title23/agency10/chapter20/section200/
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Aug 15, 2020 17:02
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Yeah, if you mail a return it can be worth sending it certified to have tracking info available. Just got done sending a copy of a 2018 Form 1041 to the IRS because they said they didn’t have it for the third time counting the original submission, might have been able to skip this one if client had found the little certified receipt and we could tell the IRS when it was sent and received the second time. Of course, the real annoyance is they obviously got the check that was sent with the original filing since their letters have been basically “we have this payment, but no return”; guess they didn’t check the envelope the check was in... 
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Aug 17, 2020 13:55
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Speaking of mailing stuff to the IRS. If I'm amending two different returns, do I mail them together or separately? Do I staple the pages of each amendment together? Clip them? I'm probably overthinking this but I figure it doesn't hurt to ask.
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Aug 17, 2020 23:25
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Ur Getting Fatter posted:Speaking of mailing stuff to the IRS. If I'm amending two different returns, do I mail them together or separately? Do I staple the pages of each amendment together? Clip them? Mail them together. Do not attach the two returns to each other. How exactly they will be processed will vary but that's probably the kindest you can do for the people who will process them. If you are being audited, mail the returns to the person doing the audit, not to the general address for processing amended returns. Otherwise you're adding a month minimum to how long your audit takes.
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Aug 18, 2020 05:34
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Anyone gotten their refund from Austin IRS? Their ITIN operation been sitting on a W-7 for 4+ months now that I sent as certified mail.
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Aug 19, 2020 05:16
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Turrurrurrurrrrrrr posted:Anyone gotten their refund from Austin IRS? Their ITIN operation been sitting on a W-7 for 4+ months now that I sent as certified mail. ITIN department seems to have been shut down for a bit, they’re only now replying to applications we sent in March in many cases. Been something of a nightmare here because several of us were getting our CAA status renewed including me, and the shutdown meant they didn’t do the renewal, so we only had one person whose CAA sign offs were being accepted so all our ITIN applications were being bounced back because they don’t show us as certified anymore. We re-sent a bunch of them under the active person in response to the CP566 rejection letters but they apparently didn’t open their mail because they keep sending CP567 letters like we never replied. Been stuck re-mailing the CP566 responses with an implicit “What gives, guys, we sent you a response” and hoping they read this one, because I don’t have the power to do anything else since the one active CAA is on break until September. And I sent all my drat renewal paperwork in February 2019 to avoid this kind of crap! 
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Aug 19, 2020 16:27
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MadDogMike posted:ITIN department seems to have been shut down for a bit, they’re only now replying to applications we sent in March in many cases. Been something of a nightmare here because several of us were getting our CAA status renewed including me, and the shutdown meant they didn’t do the renewal, so we only had one person whose CAA sign offs were being accepted so all our ITIN applications were being bounced back because they don’t show us as certified anymore. We re-sent a bunch of them under the active person in response to the CP566 rejection letters but they apparently didn’t open their mail because they keep sending CP567 letters like we never replied. Been stuck re-mailing the CP566 responses with an implicit “What gives, guys, we sent you a response” and hoping they read this one, because I don’t have the power to do anything else since the one active CAA is on break until September. And I sent all my drat renewal paperwork in February 2019 to avoid this kind of crap! Sounds like a nightmare. I had to Google those terms and I hope I never need to get that involved. I'll be happy if I get my return and an ITIN for my kid before Thanksgiving.
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Aug 19, 2020 23:26
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I don't know about the ITIN department specifically, but the Austin IRS was shut down for a few months for COVID; it only reopened in June and is still understaffed due to high-risk employees being on safety leave. I know it sucks, but please be patient.
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Aug 19, 2020 23:35
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Some more info on interest payments from the IRS. https://www.accountingtoday.com/news/irs-plans-to-send-13-9m-taxpayers-extra-interest-on-their-tax-refunds-amid-coronavirus quote:The Internal Revenue Service and the Treasury Department plan to send interest payments averaging $18 to approximately 13.9 million individual taxpayers who filed their 2019 federal income tax returns on time and are receiving tax refunds.
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Aug 20, 2020 12:26
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For the second year in a row, I’ve owed the IRS over $10K which seems very strange to me. Does anyone have any idea why my tax burden would be so high given the following? Single Standard Deduction Claiming 0 allowances All of my wages are W2 I max out my ESPP (and sell upon vest) Get about $24K a year in RSU (sell upon vest) Max out my 401k and HSA Why wouldn’t having my tax withholding on my W2 if I’m claiming 0 cover everything or at least close? Any ideas what I should look at?
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Aug 21, 2020 03:15
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dexter6 posted:For the second year in a row, I’ve owed the IRS over $10K which seems very strange to me. It's very likely ESPP and RSUs. Those are withheld at a really bullshit arbitrary (low) non-calculated rate, if they are at all. You need to calculate your own tax burden here.
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Aug 21, 2020 03:35
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dexter6 posted:For the second year in a row, I’ve owed the IRS over $10K which seems very strange to me. This right here. Also make sure you are appropriately adjusting your basis for the espp. TurboTax has a whole workflow for it. Otherwise you may be double paying some of it that is reported on your w-2 AND brokerage tax forms. Your rsu's and espp are likely withheld at 22% federal, which if you're up in the 30% range could trivially add up to $10k.
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Aug 21, 2020 03:40
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H110Hawk posted:This right here. Also make sure you are appropriately adjusting your basis for the espp. TurboTax has a whole workflow for it. Otherwise you may be double paying some of it that is reported on your w-2 AND brokerage tax forms. Second question: I got a CP2000 from 2018 tax year because I forget to enter a form. So I got charged interest. But the amount they think I owe is an over estimate, and therefore the interest charge is wrong. When I file an amended return, and attach a check for the difference, should I not include interest and let the IRS send me one last bill for the interest or is there a way to calculate and send the correct interest amount? Obviously not trying to skirt any laws, I hosed up, but, I also don’t want to over pay.
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Aug 21, 2020 14:25
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Don't file an amended return, just call the number on the CP 2000 and fax whatever documents they ask for to them. They will recalculate the amounts (if they agree). Probably should pay the tax you think you owe in order to stop interest on that.
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Aug 21, 2020 23:12
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Antivehicular posted:I don't know about the ITIN department specifically, but the Austin IRS was shut down for a few months for COVID; it only reopened in June and is still understaffed due to high-risk employees being on safety leave. I know it sucks, but please be patient. Got mine! Only took them 135 days to produce a CP565. Now let's see the monay and my kiddos documents come our way :-)
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Aug 26, 2020 19:44
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I’m starting an LLC with a partner and we are stuck on deciding between regular LLC vs. being taxed as an S-Corp. The accountant says there are advantages to both, but we still aren’t sure. Anyone know about these things? It’s a 50/50 partnership, but one of us will need to take out more on a weekly basis, one of us has bad credit and is currently on a payment plan with the IRS (not sure in what way this matters but it’s a consideration?) Until now I have been working for a different company as an independent contractor so I’m used to filing with 1099 and itemized deductions. So I know it will be different than what I’m accustomed to either way. But there is some advice around that with an s-Corp being able to be an “employee” of your own company has benefits. I’m flailing around in asking this question because I’m pretty confused about what question to ask. But if anyone has advice I’m all ears.
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Aug 29, 2020 14:26
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The benefits to either can somewhat vary state to state, depending on your local/city/state taxes as well as laws for those entities LLC vs. S-Corp. From my experiences an S-Corp setup will have more fees/taxes/licenses required and therefore expense than a sole proprietorship, so you need to be making at least X amount to make the taxation benefits offset those additional costs both in money and your time in dealing with them. Your accountant should be able to lay out for you what those actual differences are for your area and then you can make a better decision. Currently my wife and I do an S-Corp with monthly salaries of different amounts (your "one of us will need to take out more on a weekly basis"), we have the S-Corp fund into retirement plans for us every month plus a year end lump sum depending on how the money situation is, the S-Corp year end net profits are then reported out via the share split (so in your case 50/50) on a K-1 and your federal level taxes are then paid on your individual personal returns with your W-2 salary income plus your K-1 income. To get the K-1 profit out of the business you and your partner would have the business write shareholder distribution checks, which you can do at any time during the year but CPAs generally tell me you want 60%+ of your income to come from salary and not the distributions or the IRS might think you're just trying to pay less taxes by underpaying salary. I've never dealt directly with an LLC so can't be much help there.
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Aug 29, 2020 20:23
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Please don't do true 50/50 for decision making. Have some way of breaking a deadlock in your bylaws.
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Aug 29, 2020 20:53
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devilmonk posted:I’m starting an LLC with a partner and we are stuck on deciding between regular LLC vs. being taxed as an S-Corp. The accountant says there are advantages to both, but we still aren’t sure. Anyone know about these things? As tangy mentioned, these things can vary from state to state, but from a federal tax law standpoint, an S-corp can have significant tax advantages in some situations (e.g., certain kinds of losses don't flow through on LLCs, and S-corp profits are not subject to employment taxes.). However, the S-corp also has to employ you and your partner and pay you a reasonable salary (revenue permitted), which adds a little extra accounting overhead. But that can also be advantageous if you're interested in certain kinds of employee benefits. You'd probably have to give a lot more detail in order to give advice for your specific situation.
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Aug 30, 2020 01:01
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