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SlapActionJackson posted:No need to do anything. It's a loan not a gift. For tax purposes, the value of the gift is market rate interest on the loan you forgo, which in this case will be well under the annual exclusion. Thanks! That's what I was suspecting, but I wanted more confirmation.
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Nov 1, 2022 03:34
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Pyroclastic posted:there's a tax-free gift limit of like $15-16k $12 million. That's the tax free limit. There is a reporting requirement but it's $12 million. Plus this is a loan.
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Nov 1, 2022 05:39
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A question for you keepers of knowledge. I've lived in FL for the entire year, employed at the same new job for the entire year. Single, no kids. I haven't put any money into a 401k this year (I know) or any other tax-helping accounts. I make a good salary. Are there any easy wins I can do between now and end-of-year to reduce how much I will owe come tax season? Hughmoris fucked around with this message at 14:50 on Nov 1, 2022 |
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Nov 1, 2022 14:40
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Hughmoris posted:A question for you keepers of knowledge. Your ira is there and willing. Depending on your salary it probably makes sense to do roth or backdoor roth. This is a win in the long-term. The amount of tax you owe is largely fixed, the only question is how much you prepaid. Will you get a refund or owe a balance due. Setup your 401k and you can reduce your taxable income dollar for dollar that you put in. Multiply that by your marginal rate (22% probably) and you save that much on your taxes.
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Nov 1, 2022 15:36
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So we were bad people and didn't file our 2020 or 2021 returns until last August. I received money by direct deposit and through a check by state in the mail, but I don't think we ever got our "stimulus checks". When I check my "Recovery Relief Credit" in transcripts on IRS.gov I see this: https://imgur.com/a/LNSk3SI Does the 0.00 mean we received it or not? I've clicked all over and can't get an answer. I'm going to look on "Line 30" of the forms when I can find them later. Thank you so much for any guidance
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Nov 2, 2022 16:00
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Elephunk posted:So we were bad people and didn't file our 2020 or 2021 returns until last August. I received money by direct deposit and through a check by state in the mail, but I don't think we ever got our "stimulus checks". To determine how much RRC you could get for each year, you calculate the total amount of the credit you are eligible for using the RRC worksheet then subtract any EIP payments you received to determine how much RRC you should actually claim. The link you posted is showing that you were not issued any EIPs (the amounts are all 0s) so you would claim the full RRC you were eligible for in each year. If the RRC was properly claimed on your returns you'll see the amounts listed on line 30 and it would have been included as part of your overall federal refunds. If there's nothing on those lines you'll need to file an amended return for each year to claim whatever credit you were eligible for. Note that this is for federal purposes only. If your state had their own stimulus payments (I think some did), you'd need to check with your state's department of revenue to see how that's handled.
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Nov 2, 2022 16:40
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Let's say you live in city with rent control. The local ordinance specifies that the owner must pay the tenant a relocation payment of $X to move the tenant out of a unit for various reasons such as an owner-move-in. Is the payment taxable to the tenant?
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Nov 8, 2022 02:09
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socketwrencher posted:Let's say you live in city with rent control. The local ordinance specifies that the owner must pay the tenant a relocation payment of $X to move the tenant out of a unit for various reasons such as an owner-move-in. Is the payment taxable to the tenant? That sounds a lot like 'cash for keys' which is taxable income.
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Nov 9, 2022 16:49
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sullat posted:That sounds a lot like 'cash for keys' which is taxable income. Thanks sullat. I've gotten conflicting info from the city, and tenants say they're also getting conflicting info. The owner's tax preparer is on an extended vacation and won't be back until after Thanksgiving.
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Nov 9, 2022 17:57
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socketwrencher posted:Thanks sullat. I've gotten conflicting info from the city, and tenants say they're also getting conflicting info. The owner's tax preparer is on an extended vacation and won't be back until after Thanksgiving. Yeah, I'd check with a local preparer for that one. Only thing I'm aware of that's similar is that payments by employers for relocation is taxable, and that's not the same thing as a governmental ordinance.
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Nov 9, 2022 18:56
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MadDogMike posted:Yeah, I'd check with a local preparer for that one. Only thing I'm aware of that's similar is that payments by employers for relocation is taxable, and that's not the same thing as a governmental ordinance. Right on, thanks. Apparently this tax season was a rough one so we don't want to bother him while he's decompressing.
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Nov 9, 2022 19:50
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Lease buyouts are capital gain income. See §1241.
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Nov 9, 2022 21:15
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Missing Donut posted:Lease buyouts are capital gain income. See §1241. Interesting, thanks. These tenants are residential, not sure if their rental agreements are considered capital assets.
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Nov 9, 2022 21:24
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socketwrencher posted:Interesting, thanks. These tenants are residential, not sure if their rental agreements are considered capital assets. They are. Take a look at §1221. (edit for context: §1221 has the definition of a capital asset, but sections §§1231-1260 talk about specific rules related to capital and other similar assets) Missing Donut fucked around with this message at 00:06 on Nov 10, 2022 |
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Nov 9, 2022 23:36
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Missing Donut posted:They are. Take a look at §1221. Hey I appreciate the help but I keep running into things like "trade or business" and "constructive ownership transaction" and don't see anything regarding residential tenancies (though I certainly could have missed it or not understood how those are included too), so I'll wait for the tax guy to get back- Cheers.
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Nov 10, 2022 20:01
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socketwrencher posted:Hey I appreciate the help but I keep running into things like "trade or business" and "constructive ownership transaction" and don't see anything regarding residential tenancies (though I certainly could have missed it or not understood how those are included too), so I'll wait for the tax guy to get back- Cheers. Hey I'm sorry that the response from a CPA who has researched this specific situation in the past and provided both the answer and tax code citations for you and the other professionals in this thread is insufficient. I wish you the best of luck with the advice you get from your landlord's tax guy- Cheers.
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Nov 10, 2022 21:23
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Intuitively, if you sell your house for more than you bought it that's capital gain. If you dispose of your lease for more than you entered it, seems that's similarly capital gain. Owner-occupier home sellers get an exclusion, but not surprising renters don't get an exclusion.
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Nov 10, 2022 21:41
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Missing Donut posted:Hey I'm sorry that the response from a CPA who has researched this specific situation in the past and provided both the answer and tax code citations for you and the other professionals in this thread is insufficient. I wish you the best of luck with the advice you get from your landlord's tax guy- Cheers. Oh jeez sorry if I came across as not believing the guidance, I just meant that I couldn't parse the code. I sincerely appreciate the feedback from everyone. Epitope posted:Intuitively, if you sell your house for more than you bought it that's capital gain. If you dispose of your lease for more than you entered it, seems that's similarly capital gain. Owner-occupier home sellers get an exclusion, but not surprising renters don't get an exclusion. Makes sense, thanks. I suppose I'm just wondering how a basis would be determined. These are month-to-month leases that due to rent control are essentially lifetime leases with limited exceptions.
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Nov 10, 2022 22:01
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What's would be the term for determining long term vs short term capital gains? Start of the lease till move out date?socketwrencher posted:Oh jeez sorry if I came across as not believing the guidance, I just meant that I couldn't parse the code. I sincerely appreciate the feedback from everyone. Basis is irrelevant. The gross proceeds are the gain and that's all that matters. If you wanted to you could think of it as the total payments the renter paid are the basis and they received the intangible benefit of living in the space equal to the payments plus the buyout.
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Nov 10, 2022 22:06
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Epi Lepi posted:What's would be the term for determining long term vs short term capital gains? Start of the lease till move out date? Ok got it, thanks. Note that this isn't a situation where I'm helping out some scumbag landlord. It's a single family house where the owner rented out rooms. The owner died, which means the house now falls under rent control because the "SFH where the owner lives in the house and shares a kitchen and bathroom" exemption no longer applies since the owner is no longer there. The owner's sister and her adult son would like to move in because the son needs a caregiver.
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Nov 10, 2022 22:15
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OK, weird one for my fellow tax pros out there. Clients got a letter proclaiming they had five railroad retirement RRB-1099-R forms not reported, when A to my knowledge you don’t generally get more than the one railroad retirement form per person, and B it somehow managed not to include the actual RRB-1099-R forms both spouses received. Also listed distribution codes of X, Y, and Z, which to my knowledge don’t actually exist for tier 2 railroad retirement or even 1099-R. Is my assumption some computer at the IRS or railroad threw a circuit a reasonable one, or is there some sort of strange way this could be real? Every time I get this kind of nonsensical thing, I find myself unsure if I’m being gaslit or there a random rule somewhere I’m forgetting.
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Nov 17, 2022 20:26
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I’ve seen four railroad 1099s between a couple. Both worked (getting a pension and social security equivalent 1099 on their own record) and both had a spouse payment of a separate pension 1099. Never saw five, though. I’m not sure what the distribution codes mean in the IRS system.
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Nov 18, 2022 00:15
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Hello goons, I have a withholding question for you all: I just started a new job with a ~$60k annual wage. However, since I started half way through November I'll only be earning about ~$20k total this year (including other jobs and income), so I won't owe much (if anything) in taxes. I'd like to minimize my withholdings right now in order to contribute as much as I can to my Roth 401k for 2022. Can I just edit my W-4 elections' deductions (line (4b)) to something high like $50k to greatly reduce my withholdings? Or how else could I minimize (or eliminate) my withholdings for this job for 2022? And of course I'll be sure to correct it back for 2023. Also looking for similar advice for CA state tax, if possible. Many thanks. literally this big fucked around with this message at 08:27 on Nov 22, 2022 |
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Nov 22, 2022 08:21
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Can someone explain taxation on RSUs (restricted stock units)? When a RSU matures, I pay some cost (tax?) on its current price (I assume current, and not the price when it was “promised” to me). Is that cost calculated just based on my regular income tax bracket or some characteristic of the stock, or some cap gains tax? Do I pay standard cap gains taxes again on sale of the stock? Do I have any tax considerations if a RSUs value increases/decreases from when I paid the maturation tax? e.g., if I receive it at $100 and pay the receiving cost at that time, does anything taxable change if I cash it out at $50 or $200? I’m considering a sell-off sometime in the future and want to be prepared.
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Nov 22, 2022 18:48
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PRADA SLUT posted:Can someone explain taxation on RSUs (restricted stock units)? It's income based on the price at vest. The value of your grant is just the numerator on your stock quantity, the divisor is the value when granted. They just use that value to show you how much they are intending to give you over time. For Example. $10,000 grant of a $100 stock means you get 100 shares of stock. Now those shares vest over time. Let's say they vest annually. You will get 100 shares 12 months later. The current price is $120. You owe ordinary income tax on $120*100 = $12,000. This is just as though you got it on your paycheck. This is now your "basis." If you hold it for another 12 months for unknowable reasons and sell it at say, $90, that's $9,000 in your pocket and a long term capital loss of $3,000, you cannot claim this back against the ordinary income[1]. Same example but it's $120 = $12,000 in your pocket, no new taxes because you have no gain or loss. Same example but it's $140 = $14,000 and $2,000 in Long Term Capital Gains which you will owe taxes on. That's it. [1] The IRS gives you some amount of this back but it's not relevant to this example as it's a low aggregated annual cap. If you have a bunch of these transactions it all is still under that one limit, this is a general example.
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Nov 22, 2022 20:11
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So it’s effectively as if you received a cash “bonus” income and immediately bought stock with it? e: in the above example where you sell at a loss, can you claim a capital loss carried forward? PRADA SLUT fucked around with this message at 21:16 on Nov 22, 2022 |
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Nov 22, 2022 21:13
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PRADA SLUT posted:So it’s effectively as if you received a cash “bonus” income and immediately bought stock with it? yes
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Nov 22, 2022 21:15
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Also, some employers will reclaim some of the stock when it vests as income tax withholding, and some won't. Make sure you know which one is happening!
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Nov 22, 2022 21:18
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It's doubly great if your company isn't public and you get to decide if you want to pay taxes for something you can't sell. you should not
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Nov 25, 2022 00:41
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KillHour posted:It's doubly great if your company isn't public and you get to decide if you want to pay taxes for something you can't sell. you should not I've only ever seen pre-ipo companies offer ISOs. Do some actually give out RSUs?
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Nov 25, 2022 02:48
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Methanar posted:I've only ever seen pre-ipo companies offer ISOs. Do some actually give out RSUs? I worked at one company that made you a member of the LLC, form k-1 and all. 
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Nov 25, 2022 03:02
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Methanar posted:I've only ever seen pre-ipo companies offer ISOs. Do some actually give out RSUs? ISOs factor into AMT when exercised, right?
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Nov 25, 2022 15:22
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raminasi posted:ISOs factor into AMT when exercised, right? Yes. If not disposed of in the same year.
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Nov 25, 2022 16:41
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Methanar posted:I've only ever seen pre-ipo companies offer ISOs. Do some actually give out RSUs? Double trigger RSUs are the new hotness
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Nov 26, 2022 21:26
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literally this big posted:Hello goons, I have a withholding question for you all: Sorry for the self-bump, but does anyone have any advice or feedback on this? My hours worked for my first paycheck are going to get approved tomorrow. My car just broke down, so I'd like as much cash on hand as possible to buy a replacement ASAP, rather than waiting for a refund come April. And like I said, I don't think I'll even end up owing any taxes for 2022, anyways. Thanks.
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Nov 27, 2022 20:54
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literally this big posted:Sorry for the self-bump, but does anyone have any advice or feedback on this? My hours worked for my first paycheck are going to get approved tomorrow. My car just broke down, so I'd like as much cash on hand as possible to buy a replacement ASAP, rather than waiting for a refund come April. And like I said, I don't think I'll even end up owing any taxes for 2022, anyways. Thanks. https://www.irs.gov/individuals/tax-withholding-estimator Go here and fill it out. It's improved an amazing amount. At the end there is a "adjust my witholdings" thing. However the IRS is purposefully making it hard for people to play dumb games with their W-4's because of all the people causing themselves huge legal headaches over the years.
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Nov 27, 2022 22:53
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literally this big posted:Sorry for the self-bump, but does anyone have any advice or feedback on this? My hours worked for my first paycheck are going to get approved tomorrow. My car just broke down, so I'd like as much cash on hand as possible to buy a replacement ASAP, rather than waiting for a refund come April. And like I said, I don't think I'll even end up owing any taxes for 2022, anyways. Thanks. It doesn't look like the California Franchise Tax Board has a calculator but does have a worksheet that serves a similar function.
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Nov 27, 2022 22:54
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Apologies in advance if this is too specific. I work in New York for a company based in Seattle. My work is remote, although I'm renting an Industrious workspace so that I don't get sick of my cat and vice versa (and I strongly prefer working outside of my apartment, you know how it is...probably). Anyway, I'm trying to set up a transit FSA so that I can set aside enough money for a 30-day Metrocard every month. This is something I've done before, but this is the first job that I've had that has been 100% remote for the whole time I've been there. At my old job (which I started in January 2019, in New York), I had a transit FSA but I didn't have to work from home until March 2020, and I was fully able to use my transit FSA without issue after that until I left the company in March 2022. Here's what my benefits manager has to say about my intentions now: quote:These Transit FSA plans only allow for funds to be used when you are commuting to your regular place of work. Since we have no offices in New York, any expenses paid for under these accounts may be considered ineligible under Section 132 of the IRS tax code. You will want to check with your CPA or tax advisor to determine if your expenses are eligible under this plan. How likely would a transit FSA under these circumstances be considered a violation? I looked at Section 132, and it doesn't appear to have any rules that would exclude me. I'm a full-time employee.
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Nov 29, 2022 00:28
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H110Hawk posted:Yes. If not disposed of in the same year. Yeah, pretty sure ISO no longer gets ISO special treatment if you do that, right? Minimum 2 years holding before vesting then hold it 1 year before sale. Hope I'm remembering right considering I'm taking the 1st EA exam in a few weeks and AMT is crushing my will to live studying it (God help me if they ask for me to calculate it, the whole crazy exemption/phaseout/26% vs. 28%/compare to normal tax thing drives me insane trying to do it without a computer handling things). YeahTubaMike posted:Apologies in advance if this is too specific. I work in New York for a company based in Seattle. My work is remote, although I'm renting an Industrious workspace so that I don't get sick of my cat and vice versa (and I strongly prefer working outside of my apartment, you know how it is...probably). You may need to pay someone to research this one, I have absolutely no idea what the rules are on personally rented Industrious workspaces as "work places" for the transit FSA rules. I can recall at least some of the rules for what expenses can be claimed, but I'll be damned if I recall any rules regarding whether that kind of location counts (does the IRS even have such regs, or have technology/lifestyle changes once again outraced the rule making?).
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Nov 29, 2022 01:04
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MadDogMike posted:Yeah, pretty sure ISO no longer gets ISO special treatment if you do that, right? Minimum 2 years holding before vesting then hold it 1 year before sale. Hope I'm remembering right considering I'm taking the 1st EA exam in a few weeks and AMT is crushing my will to live studying it (God help me if they ask for me to calculate it, the whole crazy exemption/phaseout/26% vs. 28%/compare to normal tax thing drives me insane trying to do it without a computer handling things). Honestly I do not know. I just know that some of my coworkers freak out about AMT like its some kind of boogey man despite literally not having a single ISO option. What I recall is you can exercise upwards of $100k of income per year of them as an incentive but if you don't then sell them inside the same year they're exercised they're income on the AMT worksheet. From there I called a guy name Bo who helped me out. He was great. I like pulling up the form on a shared zoom screen and asking them inane questions "Do you have any circulation costs? ... what about Mining income?" It's insane to not have a computer do it, I'm sorry they make you memorize it for a test.
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Nov 29, 2022 01:26
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