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Bojanglesworth posted:Good afternoon, all! I have a few questions to clarify before filing so that I can try not to gently caress myself again, so here goes: 1. Person on phone was wrong, custodial parent in this situation gets exemption under the tiebreaker rules. It has NOTHING to do with time of filing. You CAN have that exemption passed to you as part of the divorce agreement (I know some divorce agreements have parents swapping the exemption every other year and the like) or by having them fill out a Form 8332 to release the exemption, but minus any specific agreement from all parties involved the IRS rules will default to the rules that give it to parent with more custody time. Also note that while you pay the child care expenses, you can't claim that credit even if the other parent released the exemption to you, that one requires the custodial parent to be claiming it. Releasing the exemption doesn't necessarily make a dependent qualify for you for certain things tax-wise, that's one of them. 2. Yeah, you want to have them. Worst case you can file without them, but that requires you made a "reasonable effort" to obtain them which I'm fairly sure "didn't want to wait for the paper" won't work for  . If you're concerned you won't receive a 1099 because of problems with the person who's supposed to send them, be sure to document everything so you have the info needed.3. Think somebody with more business tax experience should weigh in here, sorry.
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Dec 17, 2014 22:32
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Anybody know what the time requirement is on when somebody should send you a 1099-DIV? It's the only item I'm waiting on for my taxes this year (for a mutual fund I have) and it seems like my bank in previous years has sent them out as late as the end of February/early March. I seem to recall they have a late deadline on when that info has to go to the IRS, but I was wondering what the deadline on mailing them to me was (a la the whole W-2 deadline being mailed by Jan 31st).
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Feb 10, 2015 00:39
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shodanjr_gr posted:Gotcha! Thanks for the fast reply! For next year there will also be a specific form going out about the same time as W-2 forms, either Form 1095-B or -C depending on your source of insurance, that will prove you had coverage. This year those forms are optional, so pretty much nobody is sending them out.
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Feb 23, 2015 00:38
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OK, basic explanation of 1095-A and premium tax credit; if your income is between 100%-400% of the Federal poverty line you receive a refundable "premium tax credit". The complicated annoying way this works is if you have insurance from healthcare.gov, and have this credit, you can "take it in advance" and have it divided by 12 and applied to your health insurance premiums to reduce the cost each month by the amount of the credit. The reason for the 1095-A stuff is at the end of the year you have to perform a "reconciliation" where you compare the amount of credit you got in advance each month to what you should have received at your income/household size, and pay back any extra you got with your taxes (or get extra money back if you didn't take all the credit you were eligible for). Now, in this particular case, these are my guesses what's going on. First and most likely, if your income is above that 400% of the Federal poverty line, then your insurance company is right and you don't qualify for the premium tax credit. I believe there's some other requirement for the credit related to if your employer offers insurance that might also be what's leaving you ineligible (don't quote me though, might be mixing up the exemption from the penalty for having no insurance at all with the tax credit here). Either way, no money for your taxes, but at least no penalty for being uninsured either. Second, I know there was some issue with the 1095-A forms, so you might theoretically be getting one late. Unlikely based on what your company said, but possible. If you're really unsure, if you have a login on healthcare.gov (not sure if your company set one up for you when you applied) you can check and see what they have listed for you, which should say if you deserved a credit. kaishek posted:Willing to be proved wrong here, but insurance premiums paid outside of an employer-sponsored plan are not tax deductible except in limited circumstances (self employed with no employer-sponsored insurance available, or if you itemize and premiums+medical expenses exceed 10% of your total income). But in that last case, you'd only be able to deduct the amount over 10% of your income. A major reason that I have not ditched my crappy, expensive employer plan is that without a tax deduction "comparably priced" plans are actually more expensive. Yeah, this is the only other way you can get any sort of tax reduction for insurance premiums. The other problem though is as mentioned the over 10% thing is only if you do an itemized deduction, which you should only do if it's higher than the standard deduction ($6200 for single person this year). So, not only does it have to be more than 10% of your total income you're paying in medical, it plus the other items you can itemize have to be more than $6200. So generally the only way you can get any deduction is if you itemize already (mortgage interest is usually the factor that makes it worth itemizing) or you have out of pocket medical expenses of the "I'm fighting Stage 4 cancer" level, in which case taxes are probably the least of your worries.
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Mar 14, 2015 21:17
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Ballz posted:So would I include the total amount I paid in monthly premiums in the same section I was putting in doctor visits, prescription meds, surgery fees, etc? Or would it go somewhere else? Based on what I've learned about the purpose of the 1095-A, I'm guessing it wouldn't go there. Pretty much, yeah. Out of pocket medical insurance premiums count as qualifying medical expenses, so whatever you paid for it counts on your itemized deduction for medical. I don't know how you enter that on TurboTax but it would probably be somewhere with your other medical expenses, not the 1095-A section (which is probably there for calculating premium tax credit). Proof-wise if you can show you paid those bills in case of an audit you should be fine, there's no specific form for medical insurance you have to have here. It's not like insurance premiums would be an UNUSUAL expense for the IRS to expect to see for someone who actually has the expenses high enough to claim after all. Remember to only add what you paid though, not what insurance paid of course.
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Mar 17, 2015 18:04
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Pretty sure if you e-pay (especially if you do it on IRS website) there's no need to fool with a voucher; I know at least paying electronically for a tax bill on a 1040 doesn't require you to mail in a voucher. Just print a copy off of the "payment received" screen for safety and you should be OK I'd think.
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Mar 21, 2015 17:48
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Nocturtle posted:Does it make sense for her to file as head of household? If she does I assume we should carefully document our household expenses and payments to make the case that she paid >50% of the costs in 2014. If you can document that honestly, then yes absolutely you can file HoH.
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Apr 8, 2015 18:28
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AbbiTheDog posted:Wouldn't seem to be very reassuring for the advice that is being posted on here. Well, some of us tax goons goof off here in random moments . Can't really shed much light on the last couple of questions unfortunately since this is my first year so I'm still at the stage of asking about some of those things myself, my advanced capital gains class is this summer.Magnetic North posted:This is very small potatoes but I wanted to ask anyway. This on the other hand I'm comfortable saying if the states don't complain to you you're fine; it's on them to complain really, and it's entirely possible that it would cost them more to complain about it than $14 anyway, especially if you've lived at that RI address long enough that they know it's yours from other info. If it bothers you too much, you can submit a new signed copy with a note explaining what happened, I'm just concerned it could put you in some kind of "review" status that makes it take longer to get any refund back. Do submit a new federal return pronto if you haven't already of course.
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Apr 11, 2015 14:12
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22 Eargesplitten posted:I sent in my 1040EZ this morning. Unfortunately, I forgot to include a copy of each of my W2s. I only realized this when I was e-filing my state taxes tonight. I included all of the income and withholdings from each of my W2s, all of the information on the 1040EZ is correct. I know that companies send the IRS copies of their employees' W2s. Do I have to send in a copy of my W2s with some sort of form, or is everything going to work itself out? The IRS may contact you with a "send us copies of the W-2s" message, just mail/fax them in to wherever they say if so. Otherwise don't stress over it, I would think the IRS won't outright reject a 1040EZ that matches info they themselves already have. In the unlikely event I'm mistaken about that, there's no actual penalty for late filing a return if you don't owe money anyway, so you'll just mail in the whole thing again with your W-2s worst case, they won't penalize you financially (hell, forgetting to attach the W-2 forms is probably only beaten by "forgot to sign return" in mistakes the IRS sees). EDIT: OK, on reflection I bet "forgot to make a check mark on the line to say you had health insurance all twelve months" will be the most common error this tax season actually. MadDogMike fucked around with this message at 04:18 on Apr 16, 2015 |
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Apr 16, 2015 04:14
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Blinky2099 posted:I originally planned to work ~8 months. I raised my federal allowances for ~4 of my pay periods by a lot to help adjust for the fact that it was withholding taxes based on me making $70k (1yr) instead of ~$48k (8 months). Now, I've extended my internship through the end of the year and lowered my allowances back down to 1. OK, important thing for the penalty for underpayment of taxes is it only kicks in if you did not withhold 90% of this year's tax, OR 100% of last year's tax. It's done that way to avoid punishing you for unexpected windfalls that aren't withheld correctly I expect. The "more than $1000" bit kicks in if neither of those are true. For example, if you withheld $700 but had $1500 in taxes, you pay no penalty because the difference is still less than $1000. If you only withheld $400, but the amount you owed in taxes the year was $400 or less, you still have no penalty because the amount you withheld would have covered all of last year's taxes; your planning was way off from the actual result, but you planned well enough to match the only solid number you had (i.e. last year's taxes). In your case it appears you're getting a warning because it's saying you've withheld only $10,207 which less than 90% of $11,700 ($10,530). So, couple possibilities. If $10,207 in withholding would have covered your taxes last year, boom no penalty, you're fine. If not, you can play with your withholding to ensure you withhold at least $10,530; I'd aim for more if possible simply because withholding is designed to have extra cushion and you don't want to get screwed up if you suddenly receive extra cash from an inheritance or gambling or something. Or, if you don't want to play with withholding you can just pay the IRS the extra $323 by the end of the year in a lump sum payment. Or finally, you can take the penalty; it's about 2% of the amount underpaid as I recall (minus a certain amount for however many days you pay before April 15th, it's kind of screwy and the sort of thing I'm glad to have software handle normally), which comes to a pretty piddly relative amount unless you're off by thousands, and you can even ask the IRS to do the actual math and send you the bill later at no additional penalty. For further info look up the instructions on IRS Form 2210. The educational credit does affect the numbers also, but without sitting down with the actual paperwork and asking you a couple questions I can't really make a guess as to how much of one, so I'm not taking it into account here; that might get you into the 90% zone on its own but probably not with just 1 semester's worth of bills. P.S. Hopefully it's obvious but this only applies to additional penalty for under-withholding. You do still have to pay whatever amount you owe before 4/15, they just won't tack on any additional charges for not paying enough in advance is all. Make sure you do have enough of a cash reserve to cover anything, and might be best to do taxes early so you know the damage if you need to save up for a month or two.
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Jul 15, 2015 21:44
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Blinky2099 posted:Thanks, that was very helpful. I owed significantly less in taxes last year, so it sounds like I'll be fine. I'll budget for the money I'll owe but not bother with additional withholdings. Glad I could help! Just remember it's a moving target each year so when you file in 2017 you'll need either $11,700 in withholding or 90% of that year's taxes. Hopefully you won't have to worry about going from 8 months income to a full year that time .
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Jul 16, 2015 16:16
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signalnoise posted:I have the following things impacting my taxes/income: The house most likely will push you into itemized deductions as opposed to just taking the standard deduction, so keep track of the following: -Your mortgage interest will be reported to you by something called a Form 1098, keep an eye out for that. In addition to the interest proper, any mortgage insurance premiums, points on the loan, and real estate tax are deductible. Depending on how you set up the loan (sometimes it's set up to escrow the funds for mortgage insurance premiums and real estate tax with the mortgage payments) this may be included on the 1098, otherwise look it up (your county should send you a form with your real estate tax info for example). -Any charitable contributions, itemized is when those start to matter. Start saving those receipts for donations, they aren't technically required for claiming small amounts (i.e. if you give a few bucks a week at church or the like) but get what you can anyway to ensure you remember them. Note this includes both cash and non-cash donations, dropping sacks of clothes at Goodwill counts. -State taxes, you have an option of using either state income OR state sales as a deduction. -Major medical expenses, anything out of pocket and NOT paid back by insurance. They have to be over 10% of your income, so unless God forbid one of you has cancer or something you are not likely to qualify, but it's worth remembering if that does happen. -Unreimbursed employment expenses, this is where those hotel expenses MIGHT apply. Note I say might because only the amount not repaid by the employer counts, and the expenses must be over 2% of your income. Check your math carefully, employment expenses can trigger closer IRS audit scrutiny because so many folks screw up what is an actual unreimbursed employment expense or try to get cute with them. Look up Schedule A for further details on itemized deductions. Also make sure itemizing gives a higher number than the standard deduction, no point doing it if it doesn't actually save you money obviously. Unless you started paying mortgage late in the year it should almost always be better to itemize though. As for the others, student loans are a deduction, and there is a lifetime learning credit for the grad school expenses, or a deduction if you don't qualify for the credit. They should send you a 1098 form for each of those with the info needed. The educational credit you can find info on by looking up instructions for Form 8863. Student loans just look up the info for line 33 in the 1040 instructions. Note I am simplifying quite a bit, itemized deductions are where I start seeing taxes getting complicated for many folks (then again, I am still somewhat amazed how many people pay me $90 for a 1040EZ, so mileage varies there apparently). There are a few little oddities that crop up, like state tax refunds with itemized deductions requiring you to include the refund as income on next year's tax return. If you itemize it may be worth it to you (if you don't already) to use tax software/a tax preparer if you are not confident with your understanding of what you're doing. Admittedly they will be a decent chunk of change to buy since you're crossing into the "things start getting at least slightly complicated" territory of tax prep as opposed to "just copy the crap off the W-2", I mainly recommend considering it because in addition to itemizing you're considering educational credits (one of the most commonly messed up parts of returns) and the employment expenses stuff which as I said can be screwed up and is likely going to get the IRS looking at the return more closely. Not really a problem if you do it right of course, but you are more likely to get a letter asking for proof than your average return so keep your records straight and available post-filing. The good news is itemizing will almost certainly increase your refund significantly, so the extra paperwork will at least pay for itself rather nicely. Itemizing also applies to many states, so double-check their info as well.
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Jul 18, 2015 05:25
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spiralbrain posted:Quick question: Was this just on the tax forms, or did you accidently put too much money in the FSA? If the latter, that one's a little too complicated for my expertise, but I seem to recall extra money might actually default to your employer; but don't take my word for it. If it's just a screw-up on the forms, you can file an amendment; just recalculate the Form 2441 with the correct info and file a copy of the corrected 2441 with the 1040X form. You'll have to pay any additional tax you owe when you file the amendment (just include a check with the paperwork for whatever amount you come up with), but I doubt the difference is going to be so substantial the IRS will slam you with a massive bill for penalties/interest over it, especially if you come to them first (and only 4 or so months late to boot). The penalty is 0.5% per month since you did file; unless your child care credit was huge I'm skeptical the recalculation is going to affect the total return that badly penalty-wise, you can also attach a statement asking for an abatement of the penalty (worst case they'll just say no is all). Harmburger posted:I'm interested in buying a house. Between two lenders, one offers a MCC and one doesn't. The loan officer is telling us that if we take exemptions based on the MCC, we'll get back every dollar of 20% of the mortgage interest. Through the first year, that's about $2200. ($312k loan at 3.25%) My wife is the only one with income now, I had income up until May of ~10k, and my wife started working in March at 55k(starting in august, 59k). This should give us a combined income for the year of about $53000. According to last year's return our AGI was $53700, leaving us with a federal tax liability of $4100(line 63, 1040). Is she correct that that 20% would reduce our total tax to $1900 and we'd actually get that money back? Where would this go on a W-4 so we could start seeing that money back monthly? Mortgage credit certificates go on Form 8396, I'd check that for full details (IRS Publication 530 has homebuyer tax info also). And yes, as a credit it's directly subtracted out of your tax liability (though it's not a refundable credit, so it can't take you below $0 tax owed). Biggest concerns are how much of the total mortgage is certified indebtedness (if the full $312k value isn't on the certificate it adjusts the credit by whatever % is certified vs. the total mortgage value), and any interest you take out as a credit with Form 8396 has to be subtracted from any mortgage interest in your itemized deduction. Speaking of which, you'll want to learn about itemizing if you haven't been. Even subtracting out the $2200 you'd get as a credit, you'd have almost $8000 in mortgage interest that with real estate taxes and (probably) state tax alone is likely to get you past the $12,600 standard deduction for MFJ. If you buy the house late in the year there may not be enough interest to be worth itemizing that year, but the following year most probably would be. So look up Schedule A and start tracking all the items on there to be safe. As for changing withholding, I'm paranoid enough to recommend you wait and see how this affects your taxes the first time before playing with withholding; especially if you itemize you may want to see the actual numbers for that along with the MCC credit. You can work out your allowances with a W-4 calculator to ensure you withhold enough; do leave some extra slack because by design the amount withheld on the W-2 is supposed to cover things without withholding like bank interest and sudden windfalls. That's why most of us get refunds in the end. Your taxes are going to decrease enough it's worth altering withholding though eventually, I'm just of the "better to have an extra high refund the first time you make a major change than wind up owing a bunch because of a bad estimate" school of thought.
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Aug 15, 2015 00:48
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That and I think the auto-withdrawal service has lower fees than the other style, so you could get charged more.
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Aug 20, 2015 17:24
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Droo posted:Since none of the tax pros answered you yet, if I were you I would use her maiden name for 2012. That is what it was in 2012, that i what the IRS should have on file for that year, and I would think using a different name would only screw things up. IRS to my knowledge goes off the Social Security database for IDing folks, so if she changed her name there definitely go with that one. Worst case as was mentioned you'd just get a bounce for "name and SSN don't match" on electronic filing so just resubmit under the other name if so. Do match whatever is written on any forms like the W-2 when entering that info, the IRS does not update things from those in their database. So long as the general return info has the current name and address it won't matter what gets entered for info on those types of forms, just so the SSN matches still.
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Oct 2, 2015 16:17
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Yeah, she has to file, but the exclusion you're thinking of will probably mean she owes nothing (look up Form 2555 for the full details on that). If you don't owe anything there are no penalties per se, people have filed years later with me. If you're comfortable with the forms you can just write it up for each year and mail it in to the IRS, otherwise a tax preparer office can certainly do it (I know someone doing it for one poor soul catching up on about ten years), though it will probably cost a fair bit as it's (relatively) complex as tax forms go. Basic online prep stuff like TurboTax doesn't come with prior year prep ability though IIRC, at least not without paying extra.
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Oct 5, 2015 22:09
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alnilam posted:Okay so the HR-type people at the non-profit that pays my stipend got back to me, when I asked if I was an independent contractor, and if I would get a 1099. That's an unusual setup; my best guess would agree with you and report it on line 21 (write "stipend [dollar amount]" on the blank line next to the line to specify what it is) of the 1040. Can't find anything else to specify differently anyway. As for FICA, the rule is you have to earn 40 "quarters" of SS taxed income of at least ~$1200 to qualify for the retirement benefits. So basically working 10 years at a standard job or paying SE tax as a contractor/business owner will do it. The actual amount you get is a different thing, related to average income you made. So don't panic, I imagine working at least 10 years before age 65 is something you can manage .
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Oct 23, 2015 14:38
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You declare how much money you made period would be my interpretation of what you're describing; the IRS doesn't care about "promised this much but got $X", they just want the $X income. If they actually paid you the money then wanted a refund, there is a refunds/returns line on the Schedule C where you would deduct that out (put the original full amount down as part of gross receipts in that case). Just double check any 1099-MISC they give you against how much you were actually paid to make sure; if they pay you less but put the full amount down on the 1099-MISC they may be trying to scam the IRS themselves so be sure you're accurate on your end (make sure you have very clear records of what they actually paid available - OK, "make sure you have clear detailed records" is pretty much rule one of any sort of tax stuff really, but this kind of story twigs my paranoia enough to emphasize that here). Anyway, my off-the-cuff assessment, and I'm just into my second year of doing taxes professionally so value it accordingly, this is the kind of thing I'd be walking over to the 10+ year veterans they usually team me with to double check .
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Nov 4, 2015 22:51
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Toshimo posted:I'm in the middle of a similar but far worse situation because I may have well and proper hosed myself. Part year return, yeah, you'll mark it on a resident return in the corner and then there's an "income received during period of non-residence" on line 12 of the MD form where you'll subtract out the unemployment income and anything else you earned while in VA. So you include it on line 1 as part of your federal AGI then subtract it out on line 12 and that will report it to MD correctly.
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Nov 18, 2015 21:10
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Nephzinho posted:Have asked a few questions in thread for friends, time to ask one for me. You certainly aren't locked to going through that CPA, you can take your materials elsewhere without causing any issue with the IRS. You'll have to pay for any amendment from H&R Block/another CPA of course, and you might need to get them up to speed on the situation, but if you think the delay is due to the CPA being slow/incompetent I'd obviously recommend finding somebody different. You can also contact the IRS (or more probably the state divisions of revenue involved, you said it was a state issue?) yourself if you think it's a problem you understand/can explain, just make sure you update the CPA if you do that so you don't get a right hand vs. left hand situation going where you both say different things. As for the accountant, sorry there's not really any penalties for him unless it was a malicious misrepresentation of the facts or he made very certain screw ups like EIC or failing to sign the return themselves. Your signature does basically mean you signed off on what he said; you would almost certainly be able to argue no malicious intent to defraud if such an accusation is made, but I imagine the tax agency involved isn't assuming fraud, just a mistake. So anything with the accountant boils down to either civil (i.e. you could TRY to sue, not sure how that would go) or anything the accountant offers as part of the service. At a minimum I assume he's not charging you for fixing his error (if he is charging to fix it, run don't walk away), I know H&R Block where I work has a guarantee we'd reimburse any penalties/interest you got charged due to a preparer error (and a certain amount of tax with one option you can pay for), whether a CPA has a similar guarantee is up to them. Apart from that, not much I can say except any preparer can screw up thanks to software error or misunderstanding or just a bad brain fart, unfortunately. Hell, my work right now boils down to helping people with amendment/audit issues, and even when they went to a brilliant guy with 20 years experience they can have something go wrong (or the IRS/state makes a boo-boo, which might even be more common; yeesh some of the odd letters folks can get sometimes...). EDIT: OK, saw your reply while typing this; it could very well be an issue on the IRS end not the CPA, they hacked customer service WAY down so response time can be a cruel joke. Sitting in front of a human being at the local office of the IRS might help if you can arrange it. Failing that, you can try contacting the tax advocate office to see if it's something they can get through for you.
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Nov 18, 2015 23:05
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kaishek posted:If I moved from DC to Texas mid-year, should I let DC know that I moved or just file a partial-year return? I've thought about sending a certified letter just to say "hey letting you know" because I'm now an expat living out of country. Partial year return should cover any "reporting" you need to do when you file it, just keep track of where you earned your income since you shouldn't pay DC tax on anything you didn't earn while working and/or living in DC.
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Nov 20, 2015 02:00
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Epi Lepi posted:The financially efficient choice is to try as hard as possible to break even so that money can work for you during the year, but you aren't being a dummy and won't get in trouble for over withholding. Slight correction, financially efficient is to withhold slightly more than actually needed to cover taxes on a W-2, because the extra helps cover the income tax on things like bank interest that don't have withholding done for them usually, and to cover minor windfalls and the like. The extra cushion is there to protect you, but since most of us don't wind up having tons of extra tax on things without withholding, most of us get refunds come tax time. alnilam posted:In other words, in January I'm going to fill out 1040-ES, calculate my estimated tax for the whole year, subtract off (roughly) what was withheld already in Q1-Q3, and send in a check for whatever is left. But since the IRS doesn't know my new job didn't start til September, I'm worried that they'll wonder why I'm sending in X dollars now, instead of having sent X/4 in April, July, and October and sending X/4 now. And then accuse me of underpayment The form you file in the event of underwithholding taxes is actually designed so you mention when specifically you earned your income vs. when you withhold and calculate the penalty accordingly. So it's built into things that you report when you actually earn the money. This only matters if you don't withhold enough to cover at least 90% of your taxes though, if you're at least that close, the IRS doesn't actually care if the whole thing came in a lump sum in December. However, see above regarding things like interest that don't have withholding, so don't get too cute with estimated payments lest you find yourself crossing that withholding penalty boundary unknowingly and when you withhold becomes an issue again. Nephzinho posted:A week after talking through this with everyone I got a letter from the state letting me know that they have received my employer's letter and will respond within 60 days. So at least I know that something is moving. My CPA hasn't responded to email or call in almost a month, so either he is dead or just doesn't want to help fix this anymore. Looks like I'll be back in the market for a tax preparer next year. Yeah, even with my screwed up scheduling since I'm part time I've never left a client in the lurch THAT long, especially if they call us looking for me. Even if he actually did the work he should drat well be able to make time to TELL you he did it when you ask.
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Dec 2, 2015 01:43
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tenaciousduy posted:Quick question (Texas) Yep, Qualifying Relative is still a dependent, just doesn't count for certain tax purposes like EIC. quote:Open enrollment for health insurance is conveniently starting around this time at my employer. Assuming I can claim her as a tax dependent, I should be able to cover her under my employer plan, yes/no? Our rep is out of the office until tomorrow so I thought I'd ask here. That's up to your employer's plan. Tax-wise as long as she has insurance from somewhere you're fine, otherwise there is a penalty for anyone you claim on your return who is uninsured without certain reasons excusing them.
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Dec 12, 2015 18:40
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Correnth posted:Thank you for the reply - Should I go back and file for those years retroactively now? Yes, there's no penalty for late filing if you don't actually owe money, and I've seen people filing as far back as 2009 this year without any issue.
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Dec 12, 2015 19:25
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Shifty Pony posted:Tax question: Healthcare.gov flubbed my fiancées subsidy calculation horrifically. Zero subsidies given despite a job change that cratered her income at the beginning of the year. I know we can get those subsidies back when we file taxes, but... Itemized deductions (like medical) come in after AGI is calculated, so no. AGI is basically the bottom number on page 1 of the 1040, itemized deduction is subtracted out on the next page. Considering several itemized deductions are limited by AGI, you have to have the number worked out by the time you get to them anyway.
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Dec 23, 2015 21:14
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Duckman2008 posted:Is this something I should be involving an actual tax person with? How big of a difference is filing for joint vs separate? It can have some significant knock-on effects to go separate; my usual remark when clients ask about it is the IRS allows it but in a very passive aggressive kind of way. You immediately become ineligible for a lot of things like EIC, the Premium Tax Credit for health care from the Marketplace, and student loan interest deduction, and other things get the worst method of calculation (Social Security taxable income is rated at the max 85% level from dollar one for example). If you can compare MFS to MFJ (and whether the savings from filing that way on your loans outweigh any tax impact) I would do that before making a decision, but in all honesty married filling separate I have only seen work out to the benefit of couples with two very high (i.e. well into the $100,000+ range each) incomes who would have phase out limits on all the credits MFS disallow due to high income anyway. Or people who are separated but without dependents or official divorce/separation decree of course. Zero VGS posted:Cool, according to that I can claim her, in fact I ran it a few times and it seems to suggest her age, whether she lives with me, and the amount I give her is irrelevant. Since she makes $0 and no one else supports her, I could technically give her Yes, parents are one of the only exceptions to the requirement that a dependent live with you for head of household. So long as you maintain at least 50% of all their support (so they are dependents) and 50% of the cost of their actual residence, you can do head of household. alnilam posted:Okay so I got some help here earlier, I just want to make sure of something. Here's a summary of my situation: OK, here's how the penalty for underwithholding works. You have to have withheld enough during the year to pay 90% of this year's taxes OR an amount that would have paid 100% of last year's taxes. It's designed that way deliberately so people don't get screwed by sudden windfalls or other life changing events; if you sent enough to the IRS by withholding or estimated payments to cover what you should have expected to owe i.e. 100% of the amount you needed last year, they won't penalize you for not being psychic enough to predict your tax situation. So, if your W-2 job withheld enough that it would have covered your entire taxes due in 2014, you are fine. You DO obviously have to make up the difference and pay any remaining money you need to cover the actual taxes due of course, but the IRS obviously knows how much you owed on last year's taxes and how much they got in withholding this year, so they don't need an actual 1040-ES to put two and two together here. Now this is obviously a moving target since your tax withholding penalty looks at the current year and the year before, so if you're a contractor this year I'd get on making estimated payments to cover your butt next year. Look up Form 2210 for more details and clarification.
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Jan 2, 2016 22:29
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and still claim her.
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C-Euro posted:My wife and I got married in August 2015, and also moved to a new state and both took new jobs in said state in the middle of 2015; we make roughly the same amount. She also is not a US citizen but files taxes anyway (here on a long-running student/work visa, green card hopefully soon). Still better off filing jointly, or do all of these little details cloud the picture? Assuming she's been here long enough on the work visa to be filing taxes on a regular 1040 and has a social security number, shouldn't have any issues there as far as tax filing goes. The states could be more complicated since you'll need to file part year resident returns for each state you lived in. If you guys were in different states before you married I'd definitely go to a professional since untangling the mess of when you earned income and where gets complicated fast. Still remember juggling a newly married couple who had lived in multiple separate states before getting married and moving to yet another state, and the one of them had a job that earned income in four separate states. Part of me sometimes wonders if the reason we never got any complaints from the states wasn't because I got it right but because all of them took a look at the situation and went  at the thought of working it out themselves to dispute it.
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Jan 9, 2016 20:37
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SiGmA_X posted:Employers are required to submit 1095-C's if you're being provided insurance. ACA thing. If memory serves it's related to getting an exemption from the penalty if you don't have insurance as proof your employer's insurance cost too much (and also a factor if you have insurance from the Marketplace because they won't give you a PTC if you can get the insurance through your employer at a reasonable cost). Honestly the 1095-B and 1095-C are still sort of optional this year; you need to be able to prove you had insurance if the IRS asks but things like proof of insurance/paying insurance bills (or for most employer-provided health insurance that nice Box 12 DD code on your W-2) still count even if you don't have the 1095-B/C, which given they pushed back the date they have to send them to you to end of March kinda tells me a lot of folks will never see the things before filing their taxes. Omne posted:Question about Form 5329: Do I put in the total amount of my distribution, or the amount I actually received (I had Vanguard withhold federal tax already)? I qualify for an exemption from the 10% penalty but am not sure which amount to put down Total amount of distribution, I can't think of any instance off the top of my head where you ever subtract out the withholding when it comes to calculating tax (withholding is paying taxes, not making what you paid suddenly tax free income).
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Jan 12, 2016 22:18
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Hadlock posted:I've lived in Texas my entire adult life, except for December of this year (and forever, moving forward) where I am now in California. Texas does not have state income tax. California does. I am freaking out about this. My salary mostly doubled and I made as much in December 2015 as I made in the first quarter of 2015 at my old job. Lots of new rules do/don't apply to me. And state income taxes are a thing now. I can't comment on too much of this as I work on the East Coast except to note that oh MAN not only did you move from a no state income tax location, you moved to the state with the most complicated state income tax system to my knowledge. I would recommend a professional to be safe here unless you are REALLY comfortable with the CA forms (in order to avoid breaking my poor manager's heart, I feel obliged to put in a shout out for H&R Block in that regard even if you aren't in my district ). Also, states can only tax income earned either working or otherwise earned in said state, or money earned while living in said state; if you have income reported as a year round figure (like bank interest or the like) you generally prorate those (i.e. work out the actual ratio of income earned in one place vs the other) to work out the number. So in your case probably only the money earned in December counts for CA. As for the relocation expenses, since you moved as part of getting a new job there is a moving expenses deduction on the federal return, check Form 3903 for details. Again, can't answer for California, since I'm not trained or registered for there. Can't really answer your bonus question because I've never run into it myself; I seem to recall they have to withhold tax at a higher rate than your salary because it is "supplemental income" (though I thought that rate was 25%?) but it just adds into your income like normal for actual taxes so it's not actually taxed differently than regular wages in the end. I'd just as soon you not take my word for it though until I double-check with a more experienced person in my office to make sure that's correct. If I'm right though, the extra withholding on the bonus income will just increase your federal refund a bunch when it's taxed at the right amount for your bracket (which, if it is $65K total income, is much less than 39%).EDIT: Yep, checked at work with our resident twenty year veteran preparer, they just withhold at the higher percentage for the bonus, the final tax on it is just the same as any other income. So you'll get the excess withholding back when you do your taxes this year. C-Euro posted:Another marriage + tax question after my last one: we both started new jobs a few months before we got married this year. When filling out W-4s for those jobs we both put ourselves down as "Single" which obviously changed when we got married. I know for a fact that I never updated my W-4 to say I was married and I'm willing to guess my wife never did either. Is that going to be an issue for our 2015 return? Single vs. married on the W-4 just affects your withholding; marking "married" reduces the withholding rate. It's not actually required to choose the married withholding rate even if you are married, many married people use single to withhold extra money for various reasons. I'd just look at your refund vs. your take home pay; if your refund is really big you can make the switch and get less withheld. Xenoborg posted:The takeaway here for me might just be to do my planning on the actual 1040 instead of calculators and set withholding allowances at like 5 with a flat extra that I calculate. Speaking from personal experience, yeah I'm terribly annoyed working with the whole "withholding allowance" thing on the W-4. Sure it's fairly good at setting the correct withholding for most folks just based on a few questions, but when the withholding ISN'T set correctly I often have math headaches trying to work out the exact withholding to recommend to a client in a way that translates correctly to a W-4. I believe the usual rule of thumb is each allowance effectively assumes a reduction of the exemption amount ($4000 for this year) from your taxable income, hence why your W-4 has you take an allowance for each person claimed on your return (since, sure enough, each one reduces your taxable income by their exemption value) and a couple other things are treated as de facto reducing your income by an exemption amount as well. Worst case scenario, you can just take the amount you were off by, divide it by the number of paychecks you'll have left in the year when your new W-4 kicks in with your employer, and just add that appropriate amount as a set figure on line 6 of the W-4 to withhold extra. Do try to work out withholding to ensure you have a cushion though; by design you're supposed to over-withhold more than the tax on your actual salary just to cover all the little incidentals where there is no withholding. MadDogMike fucked around with this message at 04:06 on Jan 15, 2016 |
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Jan 14, 2016 05:38
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BEHOLD: MY CAPE posted:You lender wants you to file your taxes before tax filing even opens? That is pretty demanding Apparently not the only ones, had somebody come in today who apparently was getting pressure regarding FAFSA stuff that was phrased to imply they somehow had to file their 2016 taxes in 2016. I'm guessing they meant they needed an estimate, otherwise I told my client they were asking for something blatantly illegal/impossible considering it's kind of hard to be utterly certain how much money you make in a year before the loving year is actually done. Yeesh you'd think people in the financial industry would know a little better. Bojanglesworth posted:Hello and good day, is there any way for me to find out an employers state tax ID number (for Virginia,) ive been search high and low with no luck. The company is Nordstrom Inc. I know there are federal EIN search engines (Nordstrom Inc is EIN#91-0515058 for what it's worth) but I couldn't find the Virginia equivalent myself. Even an old W-2 should have the number on it though, those don't usually change once they are registered. Note you DO need a current W-2 to file taxes, any tax place that lets you file with pay stubs is breaking the rules and likely to get you in deep crap with the IRS (there's a reason you have to staple the things to a paper return you mail in). You can technically file without one, but it requires you to pretty much wait until the middle of February and have proof you tried to get the thing from your employer then sign a form related to it; I've mainly done it for people filing their taxes years late after leaving the employer in question and getting a W-2 transcript from the IRS as a replacement since oddly enough the IRS doesn't have as many issues if you use the numbers they already have themselves. Kinda bad option though because it doesn't have the state info in the transcript though.
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Jan 17, 2016 08:40
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No Butt Stuff posted:"Pay more taxes so your income looks higher." Yeah, I admit to not being as familiar with the loan end of things, but this stinks; I'm highly suspicious on basic principle of anybody suggesting you somehow "game" things with your tax return. If they want to see how much income you make pre-expenses it's right at the top of the Schedule C before you deduct expenses anyway, why tell you to gently caress yourself over with extra tax bills? Not to mention plenty of businesses take a loss for tax purposes the first year or two anyway, and if I know that just from doing the taxes I would think any sane lender should be familiar with that and take it into account instead of suggesting you not report expenses. Stinky_Pete posted:I understand that part, but I meant that I expected to break even as a single filer, and then presumably get a little bit of return, as opposed to owing. We should probably add something to the OP about W-4s honestly. Say something akin to "take one allowance if you are filing by yourself, add one for every other person (spouse/dependents) you will claim on your next tax return. Make sure to have some money available by next April the first time in case it wasn't enough, file a W-4 with fewer allowances to fix next time as needed". And while I'm coming up with things everybody should know, "if you take an early distribution from a 401K/IRA, do NOT trust that automatic 10% withholding to cover the whole thing on your taxes". Seriously, practically every return I file with a large bill due boils down to messed up withholding or taking an early distribution. Or new independent contractor/sole proprietor not knowing how things change from having everything handled on the W-2, but I can hardly blame people for misunderstanding that.
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Jan 19, 2016 04:14
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alnilam posted:Yeah I'm not trying to argue that there aren't lots of good reasons to donate to charity. I donate regularly. I just don't get why people sometimes cynically say "oh [famous rich guy] is just donating to charity for the tax write-off" as if that actually makes any financial sense. I think the answer is that people who say that are misinformed about how taxes work. Pretty much, though to a certain extent "X gives to charity because of the tax benefits" is usually the philosophy behind those benefits existing in first place. I can't claim really to be an expert on tax law writing, but from studying it so far it feels personally like the reason tax law can get so complicated is primarily thanks to the collision of three at least semi-competing belief systems. One wants taxes to be "fair" (which creates complexity in tax code trying to cover edge cases), one wants to use taxes to encourage certain behaviors that are considered beneficial to society like charitable giving and saving for retirement (which creates complexity the more finely they try to direct behavior), and of course one faction that just wants to ensure they pay as little as possible (which can add complexity so people have ways to weasel, but honestly seems these days to mostly be "cut rates on us period "). Mix them together and you get most of the tax code. Again, personal belief here, so take it with a heavy grain of salt; in practical terms my only goal when actually doing taxes is to get people the best result, not worry about the why of it. Bojanglesworth posted:It certainly doesn't get any more clear cut than this, especially for the IRS Yeah, though I think it's normally treated as a mistake rather than a crime per se so don't panic about prison time or something if you get expenses messed up by honest error (God knows there's probably a bunch of poor sole proprietorships out there that must have depreciation wrong if nothing else). But please don't deliberately mess up your taxes in any way, no matter what supposed benefit it will bring, it NEVER turns out well  .
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Jan 20, 2016 20:24
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Skinnymansbeerbelly posted:Last year I obtained a judgement against my landlord-neighbor in small claims court, as reimbursement for his half of the replacement of a derelict property line fence. He paid up, but also sent me a 1099-misc, with the judgement amount in box 7. OK, this should not be taxable income in my understanding, that is generally for punitive damages (I think this just affects the basis of your home if/when it's sold). In this case I'd probably include a note to the IRS with your return (and maybe a copy of the settlement papers showing the award was a settlement) to explain things to them. Neighbor probably sent the 1099 because he's trying to treat it as a business expense (not sure enough of your specifics to guess if he qualifies to do that), but you shouldn't be on the hook for it from what you said. Document carefully in any event considering it might trigger IRS review. I'll bounce this one off some other folks at work to double check, but that's my initial read of things. PaulC posted:This year I had considerable freelance income for the first time. I also work in two different states (NY full-time job, NJ freelancing from home) and would like to deduct some expenses related to the freelance job. Business income is one of those issues where I really do want to recommend a preparer take a look at least the first time, those returns get complicated so drat fast. TurboTax can work if you know what you're doing, but it's very likely you won't know what options to pick for it. Probably can't really help you directly with a preparer unless you're near me in Delaware (well, I CAN do one not face to face, but to be blunt doing it for somebody I randomly met over the Internet and never saw in person puts ME at a certain legal liability I'm uncomfortable with myself, even if it would impress my manager with my amazing marketing skills ). I will say comfortable is a very important factor since you will by definition have to hand enough info over to make identity theft a real possibility, something a few assholes exploit going by the IRS things I've read. Though if it's a big enough firm there's usually an internal review to catch weasels; I know H&R Block reviews my returns for problems, accidental or otherwise, and I presume the other firms do something similar (though franchise offices might have a different review policy, not sure) and often offer some sort of guarantee in case of trouble.alnilam posted:Thank you. There is no limit on transfers between spouses, for gift tax purposes you have an unlimited exclusion. As for your original question, writing separate checks if you aren't married works well (you could each claim the portion of mortgage interest you pay), if you're married the IRS doesn't care who pays so long as if you do a married filing separately return everything on an itemized deduction like mortgage interest is split and you don't both try to claim the full amount. As a general rule, you'll want to file jointly unless you both make a lot of money though, married filing separately SUCKS for most purposes.
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Jan 27, 2016 02:10
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Xenoborg posted:Anyone familar with H&R Block's filing of state returns? I have a form for a credit it says to attach, but I don't see any way to. Their help has so far been no help, but I'll try again not in the middle of the night. If you mean the online software, can't really help there, but in the office at least there are certain forms we have to scan in and attach with our software, maybe it's something similar for the software version? Failing that, if you have an option to paper file instead of e-file, you can just do that and include a copy of the form with the return you mail in. spwrozek posted:If she isn't on the mortgage she can't claim an interest deduction though. At least that is my understanding. At least before they are married. Oh, right, he said she was just on the title? Yeah, that might complicate things, though I'm not sure how not being on both works since any mortgage by definition is secured by the home she has title to. I'd think you COULDN'T have a mortgage without the owners of the securing property all being in on it, how could you set up someone else's property rights to be taken away on a default without their consent? IANAL of course, but that seems like it should be an issue. C-Euro posted:OK cool, I'll check the local return to see if it's on there too. Thanks! Sounds like a software issue, there's no "splitting" you should be worrying about with filing jointly because the whole point of that status is that you and your spouse are treated as one legal entity for tax purposes (hence why you can't amend out of that status after the filing deadline because it would be impossible to split the legal liability). But federally the rule on time merely says you need to work at a new job for 39 weeks within a year following the move, not that you have to have a job already waiting when you move. So if you got your new job shortly after the move you would still qualify for a moving expenses deduction yourself, so splitting should still be legitimate. So, pick whichever option you want, putting all the expense on her or splitting it, both should be legit by my read. flyboi posted:While not directly tax related I figured this might be the best place to ask: I would definitely contact your credit monitoring service ASAP, it could be a harmless mail tear but given this is the time of year SSNs are flying out everywhere and those envelopes tend to be all too distinctive you shouldn't take the chance it wasn't deliberate. Unfortunately this actually is a relevant tax question since one of the things people can do with a stolen SSN is file a false tax return in your name. Make sure the return you filed with both the IRS AND any state returns went through OK and didn't get a reject because "social security number already used", if that happens there's a whole thing you have to go through to fix the issue with the IRS and/or states; look up Form 14039 for the IRS version or contact your state's Revenue department for more info. Or contact a professional, sadly enough we tend to have experience dealing with these things any more.
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Jan 28, 2016 19:15
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Madbullogna posted:A simple 1040X Question....... Honestly since you have to mail in a 1040X anyway, just get a copy of the current pdf from the IRS website and transfer your numbers/info over from the TurboTax form and mail that one without the watermark. Hell, I'm not entirely sure anybody actually cares about those watermarks with a mail in return anyway.
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Jan 28, 2016 19:19
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flyboi posted:I only have to do federal return as there is no tax at the state level where I live. According to Turbo Tax the status says "Approved" and next step is to transfer to my bank account. Does that mean I'm in the clear or should I still be looking into this Form 14039? Nope, "Approved" in most e-file software I know means the IRS accepted the return OK, which wouldn't happen if they had a fake one. You're fine then, any fake returns filed will just bounce now since you have your real return taken by the IRS.
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Jan 29, 2016 17:35
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Madbullogna posted:Makes sense, awesome. I'm assuming we should still wait to pop it in the mail until his refund is direct deposited though so as not to through a kink in anything? Shouldn't matter honestly, if they get it processed before the original refund they'll just reduce the refund check by the appropriate amount, otherwise they'll send the full wrong amount and you just send a check for the excess back (or pay online at the IRS website). You're hardly the first to have to suddenly file an oops amendment immediately after filing, so if you beat when the refund will be deposited I imagine they should be able to update your account correctly. You don't have to send the actual payment in with the amendment form so long as you are paid up in full by April 15th (and trust me, the IRS is very good about taking payment ).
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Jan 29, 2016 18:11
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Risket posted:Hi, I'm in a completely different tax situation than in previous years, so I'm kinda confused about some things. Yep, if you aren't insolvent (i.e. have more debt than you have assets) the whole thing counts as income. Sucks, I know, but A. still beats paying $12,500 off and B. if they didn't write it that way people would likely cheese things by giving "loans" to people then canceling them so they didn't "count". Note insolvency applies for what your resources were ON THE DATE the debt was cancelled as listed on the 1099-C, so be sure you're using the numbers from that timeframe. Helped someone clear a lot of cancelled debt once because it happened right after a house fire, which obviously left them with about zero physical assets and a mortgage still on the place so they were WAY insolvent on that date. If you're uncertain this is one of the things worth bugging an accountant over. Residency Evil posted:On the bright side, I finally earned over $100k/year for the first time in my life. On the downside, I owe $4500 in taxes. Main reason to consider an accountant is if you think you might have missed something that would reduce your taxes, (as always I find the main flaw of self-prep tax software is the issue of thinking of everything to check by yourself), but you didn't mention much here that suggests such to me off-hand. Also, $100k+ income when single tends to put you over the limit of many credits anyway. On the other hand, depending on your state taxes it may be worth itemizing so look into that just in case (check the instructions for Schedule A for details what can be itemized there). The state taxes on that much money would be at least a good chunk of the filing single standard deduction in a lot of places. Also, reason for your 10k job withholding less is because the usual design is for the job to withhold as if it was your only job. Were you only working the 10k job you obviously would be dealing with much less tax. The whole drat system breaks down with multiple W-2s, which is why you had everybody trying to work out the math and why I utterly despise trying to play with W-4s to get withholding right in these cases honestly, it's never very intuitive.
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Feb 2, 2016 05:42
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Ancillary Character posted:There's no reason to go with a non-deductible traditional IRA over a Roth. With the former, you don't get a tax deduction now and while the money grows without taxes, your gains are taxed upon withdrawal in retirement. With a Roth, you don't get a tax deduction now, your money grows tax free, and when you take the money out in retirement you don't owe tax on the gains. The general rule of thumb I've heard for Roth vs. traditional is when do you think you will be earning more money, now or when the money comes out? If you expect to have less income reported on your taxes when you retire/hit age 59 1/2+, then a traditional IRA works better because you are going to be in a lower bracket when the money distributes and you have to pay taxes on it. But if you're very low income now but might have higher retirement income like in my case (as a new-ish preparer I don't earn much now at it, but if I work into retirement age (a lot of preparers often are retired since it's just four months of desk work) I would undoubtedly earn far more with several decades of experience under my belt) then a Roth works better since my taxable income when I'm older is quite likely to exceed what I'm earning (and paying minimal taxes on) now. Barring special circumstances like that though, most people have lower taxable income at retirement (especially given how social security has favorable tax treatment) so a traditional tends to be better for most, Roth is more for said rarer situations or personal preference of not wanting to screw with taxes later on or expecting to take the whole thing as a lump sum or similar.
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Feb 5, 2016 21:40
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ThirdPartyView posted:You can still take the standard deduction even if have Schedule E income/loss - they're two separate things. If you're asking because you're renting out part of your primary or secondary residence, you just take the portion of any mortgage interest/real estate tax that applies as a percentage of the area you're renting vs the total area of your living space (i.e. if you were renting a 100 square foot room out of a 1000 square foot home, 10% of any whole house expenses) as business expenses and anything left over (90% of the mortgage/real estate tax in my example) can be taken on Schedule A if you itemize or ignored if the standard deduction is higher.
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Feb 6, 2016 21:03
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