7th Annual Anandtech Tax Time Thread

[Kroze]

I have 3 mutual funds that was bought several years ago. I haven't sold or bought anything within the account for the entire 2009 calendar year. From the beginning to end of 2009, it has lost about $5k in value. Do I have to report it in my tax return? or Do I just don't report it until i actually sell the funds at a loss/profit?

 

[alkemyst]

I have 3 mutual funds that was bought several years ago. I haven't sold or bought anything within the account for the entire 2009 calendar year. From the beginning to end of 2009, it has lost about $5k in value. Do I have to report it in my tax return? or Do I just don't report it until i actually sell the funds at a loss/profit?

have to sell anything first to really see if it's a loss or profit.

 

[Kroze]

have to sell anything first to really see if it's a loss or profit.

Thanks! Just got my tax done & filed :biggrin:

 

[dowxp]

I invested X amount of money into a business. business fails. if possible, how can i claim it?

 

[CPA]

I invested X amount of money into a business. business fails. if possible, how can i claim it?

How did you organize the business? Corporation, Partnership, Sole Proprietorship?

 

[dowxp]

i was not a part of it, but i think i found my answer.

 

[Homerboy]

Charitable Donations Question

As I mentioned earlier in this thread, my wife runs a small business. Throughout the course of the year when she is doing craft shows and the like, she almost always donates about $100 (retail) worth of items to the show and they in turn auction/raffle off these donations. Sometimes her booth/entry fees ($100+ per show) go directly to the charitable organization hosting the event too.

A) I assume these donations are deductible for her business?
B) If so, the retail value or the cost of goods?
C) Where do they get deducted?

 

[EagleKeeper]

Charitable Donations Question

As I mentioned earlier in this thread, my wife runs a small business. Throughout the course of the year when she is doing craft shows and the like, she almost always donates about $100 (retail) worth of items to the show and they in turn auction/raffle off these donations. Sometimes her booth/entry fees ($100+ per show) go directly to the charitable organization hosting the event too.

A) I assume these donations are deductible for her business? YES
B) If so, the retail value or the cost of goods? Her Cost
C) Where do they get deducted? Schedule C Line 8 (Advertising) or Line 48 (Misc Expenses)

My rule of thumb is that it is advertising if business (name) is associated with the donation when people look at it

Answers in bold

 

[Homerboy]

Answers in bold

"My rule of thumb is that it is advertising if business (name) is associated with the donation when people look at it "

That was my train of thought too.
Thanks EK

 

[JohnnyMCE]

Student Loan Question:

In Massachusetts you can only claim interest paid on undergraduate loans. My wife has undergraduate and graduate loans rolled together with a single company. Her loan company does not differentiate between interest paid on graduate and undergraduate loans. How should i handle this on my tax return since we cannot claim interest paid towards graduate loans.

 

[alkemyst]

Student Loan Question:

In Massachusetts you can only claim interest paid on undergraduate loans. My wife has undergraduate and graduate loans rolled together with a single company. Her loan company does not differentiate between interest paid on graduate and undergraduate loans. How should i handle this on my tax return since we cannot claim interest paid towards graduate loans.

We don't support state questions, however; there should be nothing stopping you from making the federal claim on it.

 

[EagleKeeper]

Contact the lender and ask them to give you a breakdown for your State filing

 

[duragezic]

I was going to file my return when I realized I don't have a 1099-DIV. Last year I got some company stock for profit sharing and I got two checks totaling less than $3 for dividends earned.

Reading the form on the IRS site, it sounds like 1099-DIV are only sent if the amount exceeds $10, like 1099-INT. But they still say to report every amount. How am I to report it without the correct, exact information? Thanks
[end question]

I used TurboTax online since 2003 since it was free and easy (statetaxfreedom.com) until last year when my AGI was higher and it cost $75 for a simple return! I checked TaxCut and TaxAct, and TaxAct is by far the cheapest ($17.95). So I started my return there, and while the interface is nowhere near as nice as TurboTax, if you have a simple 1040A return like mine, it shouldn't matter.

So I haven't gotten as far as filing it, but so far it seems like a good alternative for those not wanting to pay so much. Any other experiences?

 

[EagleKeeper]

I was going to file my return when I realized I don't have a 1099-DIV. Last year I got some company stock for profit sharing and I got two checks totaling less than $3 for dividends earned.

Reading the form on the IRS site, it sounds like 1099-DIV are only sent if the amount exceeds $10, like 1099-INT. But they still say to report every amount. How am I to report it without the correct, exact information? Thanks
[end question]

I used TurboTax online since 2003 since it was free and easy (statetaxfreedom.com) until last year when my AGI was higher and it cost $75 for a simple return! I checked TaxCut and TaxAct, and TaxAct is by far the cheapest ($17.95). So I started my return there, and while the interface is nowhere near as nice as TurboTax, if you have a simple 1040A return like mine, it shouldn't matter.

So I haven't gotten as far as filing it, but so far it seems like a good alternative for those not wanting to pay so much. Any other experiences?

Contact the company that sends you the dividend checks.

Or use your best guess. Since it is under $10 - the IRS should have no heartburn.

 

[purbeast0]

I have a question for you tax experts...

I got married in September 08, and my wife and I both had our tax forms w/our jobs set to 'single' and we never changed them afterwards.

My question is, will it benefit us any differently as far as how much $$ we will get back if we file jointly or separately?

 

[onza]

I have a question for you tax experts...

I got married in September 08, and my wife and I both had our tax forms w/our jobs set to 'single' and we never changed them afterwards.

My question is, will it benefit us any differently as far as how much $$ we will get back if we file jointly or separately?

This is as VAUGE as it gets. But I'll answer your question.

will it benefit us any differently as far as how much $$ we will get back if we file jointly or separately?

yes.

 

[purbeast0]

This is as VAUGE as it gets. But I'll answer your question.

will it benefit us any differently as far as how much $$ we will get back if we file jointly or separately?

yes.

what other details would you like?

i guess my general question is will we get more money back if we file jointly or separately.

we don't have anything to itemize at all and have a very small savings account that had some interest on it.

 

[onza]

what other details would you like?

i guess my general question is will we get more money back if we file jointly or separately.

we don't have anything to itemize at all and have a very small savings account that had some interest on it.

I would setup THREE scenarios. Use any online tax software enter your data and it will tell you where you guys stand.

1. you only
2. wife only
3. then joint

Add the you + wife then compare it to the joint.

 

[EagleKeeper]

I would setup THREE scenarios. Use any online tax software enter your data and it will tell you where you guys stand.

1. you only
2. wife only
3. then joint

Add the you + wife then compare it to the joint.

Spend the $20-30 and get S/W that you can put on your PC.
Create a file that has both of you as filing joint

Then make 2 copies of that file.
On the first copy, change your status to filing separately.
On the second, change her status to filing separately.

Saves having to renter the information 2 or 3 times.

 

[manlymatt83]

So it looks like I'm going to have the money to pay off my taxes owed before April 15th. This is my first year where I was a contractor, so I really wasn't used to the whole 1099 thing. Throughout the year, I probably only paid about 10-15% of what I owed. Now, I'm going to pay the rest by April 15th. I understand the IRS will fine me, but will they yell at me? I was supposed to be paying estimated taxes all year....

 

[EagleKeeper]

So it looks like I'm going to have the money to pay off my taxes owed before April 15th. This is my first year where I was a contractor, so I really wasn't used to the whole 1099 thing. Throughout the year, I probably only paid about 10-15% of what I owed. Now, I'm going to pay the rest by April 15th. I understand the IRS will fine me, but will they yell at me? I was supposed to be paying estimated taxes all year....

If you are within 1K, therre is usually no fines/penalties.

Realize that for self employment - you have a base of 15% for SS taxes to account for.

Main thing is to expense down as much income as possible on the Schedule C (direct and indirect) to reduce the bite.

The estimated taxes quarterly is more for your benefit (although the government wouild like it early so as to spend it). If you can send in a check in December for the missing estimated taxes; the computer will not care.

 

[pontifex]

I started doing my taxes last night and I have 4 W2 forms. I entered 3 of them and it showed I was getting over $1600 back. I entered the 3rd W2 and it dropped to a bit over $700.

I don't understand how it dropped so much. Is it because of how much I made total or what?


Also, I have a money in a 401k plan from my previous employee. I have not rolled it over yet and no money is being put into it now. Do I need a form from them for anything?

 

[Xcobra]

I started doing my taxes last night and I have 4 W2 forms. I entered 3 of them and it showed I was getting over $1600 back. I entered the 3rd W2 and it dropped to a bit over $700.

I don't understand how it dropped so much. Is it because of how much I made total or what?


Also, I have a money in a 401k plan from my previous employee. I have not rolled it over yet and no money is being put into it now. Do I need a form from them for anything?

Obviously, the more income you have, the higher you tax liability. That's what's happening when you add the 4th W-2. It could account for the biggest chunk of money you made, who knows.

As to the 401k, nothing needs to be done in terms of taxes.

 

[CPA]

I started doing my taxes last night and I have 4 W2 forms. I entered 3 of them and it showed I was getting over $1600 back. I entered the 3rd W2 and it dropped to a bit over $700.

I don't understand how it dropped so much. Is it because of how much I made total or what?


Also, I have a money in a 401k plan from my previous employee. I have not rolled it over yet and no money is being put into it now. Do I need a form from them for anything?

1) Depending on your income, you may have entered AMT territory or lost some credits or your itemized deductions were reduced. Best thing to do is remove the fourth W2, print out your return, then re-enter the 4th W2 and compare returns. So many credits are income (or AGI) dependent that you could easily see big swings based on losing them alone.

2) No, you don't need anything or have to do anything with that 401K. It's not taxed until you pull money out of it.

 

[EagleKeeper]

I started doing my taxes last night and I have 4 W2 forms. I entered 3 of them and it showed I was getting over $1600 back. I entered the 3rd W2 and it dropped to a bit over $700.

I don't understand how it dropped so much. Is it because of how much I made total or what?


Also, I have a money in a 401k plan from my previous employee. I have not rolled it over yet and no money is being put into it now. Do I need a form from them for anything?

Taxes withheld are based on the amount of income that is expected at an given employer. You control it when a W4 is filled out.

The summation of income and/or a different withholding level could effect the total tax owed and taxes withheld.

Vague, but your income from the last job could have placed you in a different tax bracket or your withholding may not have been accurate.

Also, were those jobs sequential or consecutive?

As long as you do not have control over the 401K $$, you do not need to report anything.