3rd Annual AT Tax Time Thread

[SunnyD]

Originally posted by: CPA

Originally posted by: SunnyD
Question: My son is going to a private school (Elementary). What deductions and/or credits should I be looking at? I was thinking Hope and such, however those appear to be for higher ed. only. Suggestions?

None that I am aware.

Didn't you ask this question last year?

No, last year was the questions on any possible tax shelter for avoiding capital gains from sale of land (real estate). Thanks though! You answered my question and my taxes are now efiled.

 

[alm99]

I have a question regarding my W-2s. I lived and worked in two different states this past year and I was reviewing my W-2s for the amount of tax was taken for each state and the amount I made. I stayed with the same employer all year. In the box where it says state it lists both like this:

State State ID Wages Taxes
GA 123456789 $20000 $1100
NY 123456789 $40000 $900

I think the amounts are wrong. I made more in the first six months of the year living in GA than I did in NY, mainly because I had the chance to work alot of overtime and received our annual bonus in february. Shouldn't the state wages be split almost in half of each other and since I made more in GA shouldn't that number be higher that NYs state wages?

EDIT: Wouldn't it look as though I made $60,000 over the course of the year, but only paid $900 in taxes in NY, but received $40,000 in a salary while living in NY? The whole year I my salary was $40,000, not $60k.

 

[dwell]

What's a 1099-G Statement of Tax Overpayment? I am not exactly sure what it means. They overpaid me or I overpaid them?

 

[horatiub]

ok, here is my situation:

I work full time for a company A and I get from them a W-2 form. Also, as a part-time, side job, I work in real estate, I'm a realtor, so I receive a 1099 every year. If it's important, then I can mention that my salary from company A is way bigger than my real estate income. Basically, I know that I have to fill out Schedule C, but my question is:

what other expenses can I write off? Laptop use, cell phone use, the fax at home, internet service at home, supplies etc...? Can I write off my lease payments and car use based on the mileage used for real estate travel? Can I really write off the lease payments??

Also, last year, I remember that I have used a portion of my home as a business office, so I wrote off that portion that has been used for business, but in the mean time, I have found out that it's not really worth it to use that deduction on your income tax due to the fact that when I will sell my house, I will have to pay back that deduction. Is that correct?

thank you

 

[EagleKeeper]

Originally posted by: dwell
What's a 1099-G Statement of Tax Overpayment? I am not exactly sure what it means. They overpaid me or I overpaid them?

IF you got it from a government entitiy (State) then it is a refund of state income taxes paid for the yearof 2004.

If you itemized in 2004 using your state income tax withheld; you need to declare this as income for 2005.

If you did not do any state income tax itemization; that means you do not need to declare this as income.

 

[EagleKeeper]

Originally posted by: horatiub
ok, here is my situation:

I work full time for a company A and I get from them a W-2 form. Also, as a part-time, side job, I work in real estate, I'm a realtor, so I receive a 1099 every year. If it's important, then I can mention that my salary from company A is way bigger than my real estate income. Basically, I know that I have to fill out Schedule C, but my question is:

what other expenses can I write off? Laptop use, cell phone use, the fax at home, internet service at home, supplies etc...? Can I write off my lease payments and car use based on the mileage used for real estate travel? Can I really write off the lease payments??

Also, last year, I remember that I have used a portion of my home as a business office, so I wrote off that portion that has been used for business, but in the mean time, I have found out that it's not really worth it to use that deduction on your income tax due to the fact that when I will sell my house, I will have to pay back that deduction. Is that correct?

thank you

Anything that you use in the course of generating income as a realtor can be written off.
If an item is not used exclusively; then you must proportionally expense it.

 

[EagleKeeper]

Originally posted by: alm99
I have a question regarding my W-2s. I lived and worked in two different states this past year and I was reviewing my W-2s for the amount of tax was taken for each state and the amount I made. I stayed with the same employer all year. In the box where it says state it lists both like this:

State State ID Wages Taxes
GA 123456789 $20000 $1100
NY 123456789 $40000 $900

I think the amounts are wrong. I made more in the first six months of the year living in GA than I did in NY, mainly because I had the chance to work alot of overtime and received our annual bonus in february. Shouldn't the state wages be split almost in half of each other and since I made more in GA shouldn't that number be higher that NYs state wages?

EDIT: Wouldn't it look as though I made $60,000 over the course of the year, but only paid $900 in taxes in NY, but received $40,000 in a salary while living in NY? The whole year I my salary was $40,000, not $60k.

Your best bet would be to contact the employer and verify the numbers.
It is also possible that the relocation expeses were put in the W@.

Look at the last paystub for 2005 to compare information for Federal and State taxes.

 

[spidey07]

Gambling wins/losses.

1) Do gaming wins have to be claimed in the year the bet was won or the year the bet was exchanged/cashed. (I received W2-g for winning for 2004, but date on W2-g shows 2005 and cashed in 2005...think winning bet placed 12/31/05 and cashed in 1/06)

2) What kind of documentation should be kept as far as win/loss? specifically horse racing and casino card games. I have a huge stack of tickets from horse track that are indeed my placed bets.

I have win/loss statements from the casino and track as well as reported earnings already filed with IRS.

 

[EagleKeeper]

Originally posted by: spidey07
Gambling wins/losses.

1) Do gaming wins have to be claimed in the year the bet was won or the year the bet was exchanged/cashed. (I received W2-g for winning for 2004, but date on W2-g shows 2005 and cashed in 2005...think winning bet placed 12/31/05 and cashed in 1/06)

2) What kind of documentation should be kept as far as win/loss? specifically horse racing and casino card games. I have a huge stack of tickets from horse track that are indeed my placed bets.

I have win/loss statements from the casino and track as well as reported earnings already filed with IRS.

The date that the bet win was finally completed. (Allows for multiple bets on a single ticket)

Betting slips and/or statements from the gaming establishment showing your wins/losses for the years that you are claiming losses to offset the winnings will be required for an audit.

 

[horatiub]

Originally posted by: EagleKeeper

Originally posted by: horatiub
ok, here is my situation:

I work full time for a company A and I get from them a W-2 form. Also, as a part-time, side job, I work in real estate, I'm a realtor, so I receive a 1099 every year. If it's important, then I can mention that my salary from company A is way bigger than my real estate income. Basically, I know that I have to fill out Schedule C, but my question is:

what other expenses can I write off? Laptop use, cell phone use, the fax at home, internet service at home, supplies etc...? Can I write off my lease payments and car use based on the mileage used for real estate travel? Can I really write off the lease payments??

Also, last year, I remember that I have used a portion of my home as a business office, so I wrote off that portion that has been used for business, but in the mean time, I have found out that it's not really worth it to use that deduction on your income tax due to the fact that when I will sell my house, I will have to pay back that deduction. Is that correct?

thank you

Anything that you use in the course of generating income as a realtor can be written off.
If an item is not used exclusively; then you must proportionally expense it.

Ok, thank you for your response. Now I just need to find out exactly where should I put all the deductions on the Schedule C form. Turbo Tax Premier is good, but not very explicit.

Also, is it a good idea to use a portion of my home as a deduction for a business office?

 

[spidey07]

Thanks eaglekeeper...

So a single bet win in 2005, but not cashed until 2006 can be filed in 2006? Normally cashing it in 2006 is when you sign the papers. I ask because I hit a single bet 2,000 winning ticket on 12/31/05 but of course couldn't cash it becuase I didn't have my social security card with me and am wondering if I should claim that on 2005 or 2006.

"bet win finally completed" means exchange of winning ticket for cash, correct?

to that end, what audit flags would be raised? I'm not trying any funny business as i can verify that loss > win. Just wanting to know.

-edit-
you guys rock for doing this every year. Ever need network or AV help please PM me.
:thumbsup:

 

[CrimsonChaos]

Originally posted by: CPA

Originally posted by: CrimsonChaos
Hello, great thread. Here's my question:

My wife works downtown where she pays $5.00/day for parking. All of dowtown is metered, so she has no choice in this.

Can she deduct this on her taxes -- if so, does she need to have receipts?

It would be a miscellaneous itemized deduction. You would have to itemize and you could only claim the amount that is over 2% of your AGI.

Thanks for the response. Just for clarification, would she need receipts for this or no?

 

[alm99]

Originally posted by: EagleKeeper

Originally posted by: alm99
I have a question regarding my W-2s. I lived and worked in two different states this past year and I was reviewing my W-2s for the amount of tax was taken for each state and the amount I made. I stayed with the same employer all year. In the box where it says state it lists both like this:

State State ID Wages Taxes
GA 123456789 $20000 $1100
NY 123456789 $40000 $900

I think the amounts are wrong. I made more in the first six months of the year living in GA than I did in NY, mainly because I had the chance to work alot of overtime and received our annual bonus in february. Shouldn't the state wages be split almost in half of each other and since I made more in GA shouldn't that number be higher that NYs state wages?

EDIT: Wouldn't it look as though I made $60,000 over the course of the year, but only paid $900 in taxes in NY, but received $40,000 in a salary while living in NY? The whole year my salary was $40,000, not $60k.

Your best bet would be to contact the employer and verify the numbers.
It is also possible that the relocation expeses were put in the W@.

Look at the last paystub for 2005 to compare information for Federal and State taxes.

I paid out of my pocket to relocate, the company paid nothing.

 

[CPA]

Originally posted by: CrimsonChaos

Originally posted by: CPA

Originally posted by: CrimsonChaos
Hello, great thread. Here's my question:

My wife works downtown where she pays $5.00/day for parking. All of dowtown is metered, so she has no choice in this.

Can she deduct this on her taxes -- if so, does she need to have receipts?

It would be a miscellaneous itemized deduction. You would have to itemize and you could only claim the amount that is over 2% of your AGI.

Thanks for the response. Just for clarification, would she need receipts for this or no?

Technically, most likely, but you could probably get away with showing an agent the cost per day and her employment address.

 

[CPA]

Originally posted by: spidey07
Thanks eaglekeeper...

So a single bet win in 2005, but not cashed until 2006 can be filed in 2006? Normally cashing it in 2006 is when you sign the papers. I ask because I hit a single bet 2,000 winning ticket on 12/31/05 but of course couldn't cash it becuase I didn't have my social security card with me and am wondering if I should claim that on 2005 or 2006.

"bet win finally completed" means exchange of winning ticket for cash, correct?

to that end, what audit flags would be raised? I'm not trying any funny business as i can verify that loss > win. Just wanting to know.

-edit-
you guys rock for doing this every year. Ever need network or AV help please PM me.
:thumbsup:

If you received the W2g with a 2005 date, then you will need to report it in 2005. And you can report losses to the extent of your winnings. So my guess is you won't have to pay any taxes on your winnings (you can show $2k in losses, can't you?)

 

[EagleKeeper]

Originally posted by: alm99

Originally posted by: EagleKeeper

Originally posted by: alm99
I have a question regarding my W-2s. I lived and worked in two different states this past year and I was reviewing my W-2s for the amount of tax was taken for each state and the amount I made. I stayed with the same employer all year. In the box where it says state it lists both like this:

State State ID Wages Taxes
GA 123456789 $20000 $1100
NY 123456789 $40000 $900

I think the amounts are wrong. I made more in the first six months of the year living in GA than I did in NY, mainly because I had the chance to work alot of overtime and received our annual bonus in february. Shouldn't the state wages be split almost in half of each other and since I made more in GA shouldn't that number be higher that NYs state wages?

EDIT: Wouldn't it look as though I made $60,000 over the course of the year, but only paid $900 in taxes in NY, but received $40,000 in a salary while living in NY? The whole year my salary was $40,000, not $60k.

Your best bet would be to contact the employer and verify the numbers.
It is also possible that the relocation expeses were put in the W2.

Look at the last paystub for 2005 to compare information for Federal and State taxes.

I paid out of my pocket to relocate, the company paid nothing.

Check your paystubs against the W2 and contact the payroll department about the perceived discrepency.

The Federal should show $40K.
The payroll have not have corrected the state transition with respect to NY.
They may have the GA taxes proper; howver the state taxable income did not get reset for NY.
You will need to let NY & GA both know that you were only part-time resident in each state. NY may be able to handle the credit for taxes & income from GA.

Again, your problem is with the state taxes; therefore we can only provide you with theories, not solid advice.

 

[Starbuck1975]

Got a question for the tax experts on the forum...my fiancee and I share a household, with both of our incomes going into one checking and savings account...because we are not married, my understanding is that we have to file seperate returns...however, I believe she meets the criteria for qualifying as a dependent on my return.

If we have to file seperate returns, do we both have to claim the interest earned on our joint checkings/savings account...it was only a couple of hundred dollars, but want to make sure we are filing correctly.

 

[CPA]

Originally posted by: Starbuck1975
Got a question for the tax experts on the forum...my fiancee and I share a household, with both of our incomes going into one checking and savings account...because we are not married, my understanding is that we have to file seperate returns...however, I believe she meets the criteria for qualifying as a dependent on my return.

If we have to file seperate returns, do we both have to claim the interest earned on our joint checkings/savings account...it was only a couple of hundred dollars, but want to make sure we are filing correctly.

You can or you can split it. You will have to send in a statement with your paperwork explaining why it was done that way and provide the info of the other person. You won't be able to efile, either.

 

[Starbuck1975]

You can or you can split it. You will have to send in a statement with your paperwork explaining why it was done that way and provide the info of the other person. You won't be able to efile, either.

So we have the option of sending in a joint return...my only concern with this is it may push our combined income into the land of owing the government lots of money.

If we file seperate returns, how do we handle the joint checking/savings account?

 

[EagleKeeper]

Originally posted by: Starbuck1975

You can or you can split it. You will have to send in a statement with your paperwork explaining why it was done that way and provide the info of the other person. You won't be able to efile, either.

So we have the option of sending in a joint return...my only concern with this is it may push our combined income into the land of owing the government lots of money.

If we file seperate returns, how do we handle the joint checking/savings account?

Seperate returns just split the interest earned however you choose to.

Either 50/50 or based on income precentage.

You had better make sure that you can file her as a dependant. There are a set of test conditions that must be met.
If any one answer is in the grey area and Uncle comes a knocking; there will be heck to pay.

 

[Starbuck1975]

Seperate returns just split theinterest earned however you choose to.

I assume splitting the interest 100% to my return and 0% to her return is not an option.

If this is the case, do we just annotate on our returns that we have split the interest based on income percentage on our respective individual returns?

 

[EagleKeeper]

Originally posted by: Starbuck1975

Seperate returns just split theinterest earned however you choose to.

I assume splitting the interest 100% to my return and 0% to her return is not an option.

If this is the case, do we just annotate on our returns that we have split the interest based on income percentage on our respective individual returns?

It would be best to just attached a note stating the acocunt is joint and list both SS#s.

 

[cpals]

Quick question... I 'retired' from my previous job and they had ESOP plan and I cashed in all my stock early. A couple days ago I got two 1099-B slips stating the two cash numbers that I got back. Today I received a 1099-R and in the gross distribution box it is the total of the two slips and then in the taxable amount it's a smaller number.

What do I use for my taxes?? All three (which doesn't make sense) or just the 1099-R?

Thanks.

 

[cKGunslinger]

My wife worked as a teacher for a Christian Academy for a few months last year. They didn't take any Federal taxes from her paycheck. Does this qualify as "Religious Work?" I'm thinking not, as the School is run separately from the Church and charges tuition, etc.

 

[EagleKeeper]

Originally posted by: cKGunslinger
My wife worked as a teacher for a Christian Academy for a few months last year. They didn't take any Federal taxes from her paycheck. Does this qualify as "Religious Work?" I'm thinking not, as the School is run separately from the Church and charges tuition, etc.

Were no taxes withheld or just no Federal Income tax.
Are you basing this info from her W2 or her last paystub in 2005?

Either way; tax will be required on the income; hopefully you will not be hit with any underpayment penalties.