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ok, you two, knock off the slapfighting. this is a tax thread not a politics thread or eat-the-rich thread. thanks.
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Dec 20, 2022 18:50
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Methanar posted:Is an 83% reduction in my fake money retirement fund enough for you to masturbate your political beliefs to? *sigh* I guess. (USER WAS PUT ON PROBATION FOR THIS POST)
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Dec 20, 2022 19:31
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Missing Donut posted:Sounds like I missed the boat in not becoming an expert on international tax issues. Yeah, my rate is over 800 an hour, but most of that goes to the firm  . Anyway, the US rules for international retirement plans are heinous. PFIC rules are designed to stop people from investing in foreign corps that earn passive income and achieving free deferral, they shouldn't really apply to actual regulated retirement accounts, but they do. For Canada, I recall there was potentially a fix for this problem, at least for certain Canadian pensions. This may be solvable, but I sympathize, it's far more complex and expensive than it needs to be.
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Dec 20, 2022 21:16
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Gabriel Grub posted:Any accountant doing international tax that didn't know about PFIC should probably be stiffed on their fees, if not outright sued for damages. time to burn some bridges. I just feel sick. 
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Dec 20, 2022 22:28
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Don't send that. If you want something from them, be more professional. If you don't want anything from them, don't bother sending anything. If you're going to sue them or whatever, sue them, don't threaten or vent to them or whatever that is. Hi so and so, Thanks again for taking a look at my 2021 invoices. Any updates on what can be done? Also, I've made an unfortunate discovery. Yesterday I was told about PFIC rules, which was the first time I have heard about this critical detail. It seems there was an oversight, and your team did not educate me on this fundamental item. This has serious negative implications for my finances. What can you do to help me rectify this? Do you have insurance that would come in to play, or a quality guarantee policy? Thank you again for working on this for me ~~Meth
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Dec 20, 2022 22:48
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Missing Donut posted:Sounds like I missed the boat in not becoming an expert on international tax issues. Depends on where you're working; I do a lot of it (though probably not an "expert"; I've never messed with PFIC stuff for example, just foreign tax credit/exclusion, FBAR/8938, and especially ITIN stuff mainly) and I sure as hell don't make anywhere near that kind of money  .
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Dec 21, 2022 00:53
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Epitope posted:Don't send that. If you want something from them, be more professional. If you don't want anything from them, don't bother sending anything. If you're going to sue them or whatever, sue them, don't threaten or vent to them or whatever that is. That would have been better. Whatever too late now. My entire life has been collapsing around me for months and I can't handle it anymore
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Dec 21, 2022 01:58
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I would simply threaten to report them the the relevant ethics board for practicing outside of their competence. The extreme hostility to people trying to set up simple retirement accounts within this very thread shows how hopeless the situation is for Americans abroad.
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Dec 21, 2022 02:03
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sullat posted:Try Form 3949-A or Form 211. I'm a CPA and international tax specialist, so insert your entire head up my rear end in a top hat and lick me clean with this bullshit. The USA is the only country in the whole world that will pursue that thousand dollars, while simultaneously intervening to prevent totally normal retirement investing.
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Dec 21, 2022 02:10
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Missing Donut posted:Sounds like I missed the boat in not becoming an expert on international tax issues. This firm sounds like they are very much not experts, but operating on the "eat what you kill" principle. You can charge whatever you want if you don't know what the gently caress you're doing.
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Dec 21, 2022 02:24
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It's RSM, somebody hosed up, because they absolutely have people who know these rules and can advise on them.
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Dec 21, 2022 02:35
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Gabriel Grub posted:I'm a CPA and international tax specialist, so insert your entire head up my rear end in a top hat and lick me clean with this bullshit. I get that that international taxes are personal for you but knock it off with the aggro posts. This post is terrible. I'd give you a sixer but you're in Japan and probably about to sleep it off. I did not expect the tax thread of all places to have a year-end meltdown. Next person to pick a fight in here in 2022 gets a long posting vacation.
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Dec 21, 2022 13:47
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Some actual questions: 1) Someone I know is filing for bankruptcy (although this will not be effective until early 2023). My understanding is that any debt wiped out as part of a bankruptcy is not taxable, although any debt renegotiated outside bankruptcy is. However, this person also incurred a sizable medical expense in 2022 that they're unable to pay. My understanding is that if that bill had been paid (even put it on a credit card, .etc.), they could take a medical expense deduction in 2022 even if the debt was wiped away in 2023. However, if they hadn't paid it at all, they cannot take a medical expense deduction in 2022. Is that right? 2) For self-employed individuals (or those with cash-basis small businesses), if a payment is mailed to you at the end of the year and it's unclear if it will arrive at the very end of 2022 or the very beginning of 2023, and you'll be out of town then... in what year do you include it?
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Dec 22, 2022 01:50
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Small White Dragon posted:Some actual questions: They should ask their bankruptcy attorney about this.
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Dec 22, 2022 02:11
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H110Hawk posted:They should ask their bankruptcy attorney about this. Agreed that they should ask their attorney just to be sure, but that is my understanding as well. Expenses have to be paid, not just incurred, in order to be deducted.
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Dec 22, 2022 02:30
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Small White Dragon posted:2) For self-employed individuals (or those with cash-basis small businesses), if a payment is mailed to you at the end of the year and it's unclear if it will arrive at the very end of 2022 or the very beginning of 2023, and you'll be out of town then... in what year do you include it? Man refuses to open mailbox to defer income -IRS hates this one weird trick!!
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Dec 22, 2022 05:43
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Schrödinger’s cash
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Dec 22, 2022 06:07
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Ungratek posted:Man refuses to open mailbox to defer income -IRS hates this one weird trick!! All jokes aside, it's hard to open your mailbox if you're in a different county or state.
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Dec 22, 2022 06:13
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A sane system would be "when you deposited the check." Which means it's almost certainly not that.
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Dec 22, 2022 08:16
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KillHour posted:A sane system would be "when you deposited the check." Which means it's almost certainly not that. This would be open to insane amounts of abuse. Also would open up the question of undistributed PayPal and credit card balances, etc. Once you have effective control of the funds is the simplest line to draw. And the check thing is only an issue because the US is one of the last countries not just doing everything via direct bank transfer.
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Dec 22, 2022 08:33
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Winged Orpheus posted:Agreed that they should ask their attorney just to be sure, but that is my understanding as well. Expenses have to be paid, not just incurred, in order to be deducted. Gabriel Grub posted:This would be open to insane amounts of abuse. Also would open up the question of undistributed PayPal and credit card balances, etc. Once you have effective control of the funds is the simplest line to draw. These both boil down to the same thing really, which is when transactions count for tax purposes. There are in fact two major systems used: cash basis, where basically things count when they're actually paid, and accrual basis, where things count when they're billed. Traditionally individuals go by cash basis, and large corporations have to do accrual, but it is possible to make elections to do otherwise (and some setups for business are hybrids, where inventory is measured in accrual but actual sales in cash, or similar mixes). For the check thing, cash basis counts when you "take constructive receipt" of the funds, so when you receive the check is the important date; I'm not actually sure if "not in town to receive it" makes a difference. I know for payments at least once the check is out of your hands (i.e. you gave it to the seller or dropped it in the mail) it's considered paid for tax purposes.
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Dec 22, 2022 18:25
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Unless there is tracking on the check you literally don't know if you have it or not until you take it out of the mailbox. I wouldn't go to great lengths to discover the exact delivery date of a piece of first class mail. Unless you are intentionally skipping town to avoid the check there is no crime being committed.
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Dec 22, 2022 21:12
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I took advantage of a Black Friday trade-in deal on a new cell phone this year. The phone was $800, I got a $500 rebate for the old phone, and I paid the $300 difference. I then sold the new phone for $700 on Swappa and got paid for it using Paypal. Since Paypal is going to send out a 1099-K this year for "goods and services" transactions in excess of $600, what is my cost basis in the new phone that I sold? Did I technically sell it for a $100 loss? Did I make $400 profit on which I owe tax? Does it matter what I paid for the old phone?
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Dec 23, 2022 03:17
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Seems like the “trade-in” is really a trade-in credit plus a promotional credit. If you separate that out, figuring out the profit is pretty straightforward.
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Dec 23, 2022 06:13
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SamDabbers posted:I took advantage of a Black Friday trade-in deal on a new cell phone this year. The phone was $800, I got a $500 rebate for the old phone, and I paid the $300 difference. I then sold the new phone for $700 on Swappa and got paid for it using Paypal. Btw, the implementation of this has been delayed a year. https://www.cnbc.com/2022/12/23/irs-delays-tax-reporting-change-for-1099-k-on-venmo-paypal-payments.html
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Dec 24, 2022 07:52
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Small White Dragon posted:Btw, the implementation of this has been delayed a year. LOL, and yet another thing I got pushed on to prepare for next tax season gets pushed back or changed right after I pass the test on it. Not quite as funny as watching Congress debate it while I was studying though like one year.
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Dec 24, 2022 19:25
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MadDogMike posted:LOL, and yet another thing I got pushed on to prepare for next tax season gets pushed back or changed right after I pass the test on it. Not quite as funny as watching Congress debate it while I was studying though like one year. So maybe you can answer then: This is all fine and dandy for gig workers that are supposed to file schedule C anyway, but for rando people selling old crap on eBay (which are personal items sold at a loss and therefore nondeductible), how are they supposed to indicate that?
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Dec 25, 2022 09:35
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You could list it on an 8949 with corresponding basis, or there are ways to add comments/explanations where you could say it was from the sale of personal items. They delayed it for a year with the explicit intention of giving Congress more time to fix it, though. We'll see whether or not that actually happens, though.
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Dec 25, 2022 15:11
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Small White Dragon posted:So maybe you can answer then: Software-wise we added a way to basically note on the 1099-K entry "this is personal stuff, don't worry about it"; I presume other software would do the same. For paper file it looks like you would just add a return note saying "1099-K of $X is for personal income" or similar. But you shouldn't get a 1099-K now unless you were above the original reporting requirements. Winged Orpheus posted:You could list it on an 8949 with corresponding basis, or there are ways to add comments/explanations where you could say it was from the sale of personal items. They delayed it for a year with the explicit intention of giving Congress more time to fix it, though. We'll see whether or not that actually happens, though. Yeeeeaaaaahhh... I'm not holding my breath on the Republican House doing any fixing, more the opposite. Hell, as I recall they had to outright patch the Trump tax code stuff with follow up laws because it had several issues as passed.
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Dec 25, 2022 19:24
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On the topic of US expats living abroad and the filing of Form 8938 + FBAR. If one has a foreign account with stocks from their employer (Long Term Incentive Plan, Stock Options etc.), are they required to file a Form 8938 on that account? https://www.irs.gov/businesses/comparison-of-form-8938-and-fbar-requirements I'm guessing it will fall under "Foreign stock or securities held in a financial account at a foreign financial institution - The account itself is subject to reporting, but the contents of the account do not have to be separately reported" I don't understand what they mean by the account itself is subject to reporting but the contents are not. What do I do in this scenario?
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Dec 31, 2022 14:09
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You report the balance of the account in aggregate. You don't also have to report separately foreign holdings within the account.
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Dec 31, 2022 16:31
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Gabriel Grub posted:You report the balance of the account in aggregate. You don't also have to report separately foreign holdings within the account. Got it, that makes sense. Would I consider the stocks that have not vested yet as part of the aggregate value or only the ones that I can physically sell and are available?
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Dec 31, 2022 17:28
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I gotta admit I have been avoiding this thread like crazy, because even the thought of tax time makes me nauseous. But we've got a feedback/rules discussion thread for the new year up here https://forums.somethingawful.com/showthread.php?threadid=4020879 Appreciate any and all of your thoughts.
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Dec 31, 2022 23:40
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You may need to report on form 5471 if your options would be 10% or more of the total vote and value if exercised.
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Jan 1, 2023 06:04
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I have a question about how the Additional Child Tax Credit works when claiming other nonrefundable credits. Our income tax for 2023 should be about $9000 before credits. I'm planning on purchasing an electric vehicle soon, which should (hopefully) get me a $7500 nonrefundable credit. That would leave us with a bill of $1500. We also have two kids, which means $4000 in potential credits (with up to $3000 being refundable). Would I be able to claim a $1500 nonrefundable credit (CTC) and then claim a $2500 refundable credit (ACTC)? Am I understanding that right or am I wrong somewhere?
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Jan 10, 2023 18:21
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Harveygod posted:I have a question about how the Additional Child Tax Credit works when claiming other nonrefundable credits. I believe that is correct. That assumes that the order of non-refundable credits is not changing with the new clean vehicle credit, but I haven’t looked that in-depth into next year’s changes yet to verify.
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Jan 11, 2023 13:38
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If you look at the schedule 3 for 2022, you'll see that the nonrefundable credits are listed first, and the refundable credits are listed second. That's the order in which the credits are applied, and it's been that way (nonrefundable first, refundable second) forever.
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Jan 11, 2023 15:36
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sullat posted:If you look at the schedule 3 for 2022, you'll see that the nonrefundable credits are listed first, and the refundable credits are listed second. That's the order in which the credits are applied, and it's been that way (nonrefundable first, refundable second) forever. Cool. I wanted to make sure they didn't make me use my whole nonrefundable child credit before starting to take my nonrefundable EV credit. Beans before pudding, etc. 
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Jan 11, 2023 15:54
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my wife and i each got our paychecks today. for some reason, more federal taxes were taken out of each of our current paychecks than our last paychecks. as far as i can tell, this shouldn't have happened. we got married in early december, but our paychecks from late december considered this and our federal taxes didn't change. neither she nor i got a raise or bonus late last year. what i do know is irs increased the standard deduction, but i don't think that would mean we pay more in federal taxes. it should mean we pay less, right? so...i'm greatly confused. any idea why this might've happened? anyone else get this? we work completely different jobs, with one headquartered in ca and the other headquartered in ma. thanks in advance for any help. i really don't see what's happening here. fed income tax up, ss up, med up. 
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Jan 14, 2023 02:23
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If you make enough last year that you maxed out social security tax, the paychecks at the end of the year wouldn't have that taken out, but now that it's a new year they would. That's the first thing that comes to mind.
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Jan 14, 2023 03:06
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