7th Annual Anandtech Tax Time Thread

[slashbinslashbash]

Thank you, though I'm a little confused. My employer didn't list it anywhere on my W2 statement. I think it was treated as a reimbursement and not income as it was a separate line on my paystub. Where do I list this on the w2 form in the tax site? Do I just add the 4863.42 to my income on line 1, or do I list it somewhere else?

I don't actually know, to tell you the truth. I am self-employed and get 1099's from the people who pay me. Those 1099's encompass everything that they pay me -- payments for work completed plus reimbursements for mileage, etc. all in one lump sum. So I work all of that out on my Schedule C. I don't know how it works for somebody who's an employee, but I figured the general principle would be the same.

But I just searched and found this:

http://www.irs.gov/taxtopics/tc514.html

It would seem that if you're properly reimbursed (even if the rate isn't the same as the IRS mileage rate), you don't get to deduct it after all. And if you were allowed to deduct it, it would be on your W-2. So I guess you should just disregard it and complete your taxes normally. Kinda sucks because that would be a few thousand dollars in deductions, but hey, at least your employer is paying you to drive around.

Oh, and I am NOT a tax professional! Any advice that I have given here is strictly as an amateur and could easily be wrong.

 

[Washoe]

Hi, does anyone know, is tonight the last day you have to put the taxes in the mail? Or is tomorrow the last day? thanks

 

[Xcobra]

Hi, does anyone know, is tonight the last day you have to put the taxes in the mail? Or is tomorrow the last day? thanks

Tomorrow, sir. Send it via certified mail by 11:59 PM and you're good.

 

[Xcobra]

I don't actually know, to tell you the truth. I am self-employed and get 1099's from the people who pay me. Those 1099's encompass everything that they pay me -- payments for work completed plus reimbursements for mileage, etc. all in one lump sum. So I work all of that out on my Schedule C. I don't know how it works for somebody who's an employee, but I figured the general principle would be the same.

But I just searched and found this:

http://www.irs.gov/taxtopics/tc514.html

It would seem that if you're properly reimbursed (even if the rate isn't the same as the IRS mileage rate), you don't get to deduct it after all. And if you were allowed to deduct it, it would be on your W-2. So I guess you should just disregard it and complete your taxes normally. Kinda sucks because that would be a few thousand dollars in deductions, but hey, at least your employer is paying you to drive around.

Oh, and I am NOT a tax professional! Any advice that I have given here is strictly as an amateur and could easily be wrong.

Pretty much. If you get reimbursed then it is NOT deductible. Period. IRS will not like it if you try to pull something like deducting the difference in mileage reimbursed.

 

[scootermaster]

You do not have to file for the educational credit.

You DO have to declare the scholarship(s) as income.

The scholarships are what is increasing your income; increasing the tax owed and therefore reducing the refund amount.

Using the 1098_T identifies tuition/expenses that compensates for some of the "extra" income.

Thank you SO much for the reply. I'm not 100% sure where I'd put this extra income -- Which I assume is box 6, scholarships and grants) minus box 2 (amounts billed for qualified tuition and related expenses). If I don't file for one of those educational programs, where would I enter this information in?

Edit: Can I deduct the tuition I "paid"? I didn't actually pay this tuition out of pocket -- it was paid to the university out of my teaching assistantship award -- but it is charged (and then credited) to me. So I'm just wondering if this counts as me paying qualified tuition or not.

 

[Xcobra]

Thank you SO much for the reply. I'm not 100% sure where I'd put this extra income -- Which I assume is box 6, scholarships and grants) minus box 2 (amounts billed for qualified tuition and related expenses). If I don't file for one of those educational programs, where would I enter this information in?

Edit: Can I deduct the tuition I "paid"? I didn't actually pay this tuition out of pocket -- it was paid to the university out of my teaching assistantship award -- but it is charged (and then credited) to me. So I'm just wondering if this counts as me paying qualified tuition or not.

You wouldn't do anything with the portion you "paid." It was scholarship money that was used for its intended purpose. Now, the money you used for other purposes, ie personal, you have to include as income.

 

[Freejack2]

Pretty much. If you get reimbursed then it is NOT deductible. Period. IRS will not like it if you try to pull something like deducting the difference in mileage reimbursed.

Thanks both of you. From what you're both saying it doesn't look like I'm going to be able to reduce what I owe. Oh well.

 

[Gibson486]

WTH? I did my taxes last night....my refund was 1/5 of what is was last year. What gives? I made the same amount as last year too.....

 

[onza]

WTH? I did my taxes last night....my refund was 1/5 of what is was last year. What gives? I made the same amount as last year too.....

Did you fill out the Sch M - making work credit ?

 

[Gibson486]

Did you fill out the Sch M - making work credit ?

ummmm....turbotax did not tell me too

 

[alkemyst]

WTH? I did my taxes last night....my refund was 1/5 of what is was last year. What gives? I made the same amount as last year too.....

How are we supposed to know without more information? What taxes did you pay during the year? What deductions did you take?

Look at your old return and compare.

I got back last year and owed this year due to my home being revalued and having less paid out for real estate taxes as well as a modification to my APR from 6.875% to 2.11%

 

[gaidensensei]

I got a question for the pro tax guys.

If you buy, then sell your own things (think ebay) at a depreciated value, where is it that states you must file a tax return if you made more than $500 that year?

Overheard this at the CPA the other day but I don't know why is this the case.

 

[scootermaster]

You wouldn't do anything with the portion you "paid." It was scholarship money that was used for its intended purpose. Now, the money you used for other purposes, ie personal, you have to include as income.

Thanks for the response. I guess I just have to deal with the $2600 (health center fees, paid by my award) - $375 (fees I paid out of pocket) in extra "income", unless I actually re-file and figure out how to get one of those educational credits / some other way to lower my reported income.

Thanks again!

 

[alkemyst]

I got a question for the pro tax guys.

If you buy, then sell your own things (think ebay) at a depreciated value, where is it that states you must file a tax return if you made more than $500 that year?

Overheard this at the CPA the other day but I don't know why is this the case.

Has to do with total income. If you are over $500 in total income you include all sources whether you had a W2 or 1099, etc.

 

[BlahBlahYouToo]

what's the deadline for e-file? which time?

 

[Gibson486]

what's the deadline for e-file? which time?

Midnight Pacific time, i think

 

[BlahBlahYouToo]

Midnight Pacific time, i think

thanks bro.

 

[Chapbass]

Alright, I'll throw my situation into the mix.

I was employed by a large company until June of 09. Until April I was a resident of IL, working in IA (and going to school). From April until June I moved back to IL (transferred locations), and worked there. I know that IL And IA are reciprocal states of one another.

I'm going to use some fake numbers here, but they will be close to the differences in what I'm seeing on my report.

For my W-2, they listed in box 1 that I made 15k. They also listed in box 16 what (in my mind) is the breakdown of those two states. Heres the problem: My IA shows 14.5k, and IL shows 4k...which in my mind is a total of 18.5k. From looking at my paystubs I only made the 15k throughout the year. Furthermore, if I look at my last paystub from in IA, it shows me at 10.5k for YTD.

It almost looks like when I transferred to IL, they put each one of my hours on IA AND IL. Only catch is they didn't do it for the taxes too, so now, according to my w2, it looks like I owe state money in IA (for time it says i worked and didn't get taxed on).


Does this make any sense to anyone? Trying to figure out if those numbers are actually right and I'm just not seeing it or if they screwed up in my transfer.

Thanks!

 

[gaidensensei]

Has to do with total income. If you are over $500 in total income you include all sources whether you had a W2 or 1099, etc.

Cool, appreciate the direct word for word verbatim.

It's kinda ridiculous in a way now that I think I know the bits and ends of the tax system. We buy things that are often already taxed like PC parts off newegge, then a few years down the line we want to upgrade, so reselling them somewhere like here or a garage sale/flea market, ends up with it being mandatory that we have to report it if it's a potential loss or gain in revenue.
Quite nonsense.

 

[CZroe]

"Making Work Pay Credit" on 1040EZ keeps referencing the worksheet on the "back of the form" even though I am doing it electronically (has no "back"), but I followed the 1040EZ instructions PDF and got an amount that was just my earned wages (Box 1 from W2) PLUS the taxes taken from it (Box 2 from W2). Is that right? I mean, it gives an amount that is more than I earned, so I just want to be sure. I was all ready to skip the "Making work pay credit" line because I had no idea what that was and thought that it must not apply to me. All the questions in the instructions clearly didn't, but this is the figure I came up with. *shrug*

Edit: OK, this is supposed to go on my missing worksheet and not on the "Making Work Pay Credit" line. I found the worksheet and started it but I can't really get past the first thing... Employer's EIN. I have their "FED ID" number, and state ID number, but if FID number and Employer Identification Number are the same thing, they should say so! Otherwise, I don't know what they want. A little help?

Edit 2: DL'd the full 1040EZ to get the worksheet for line 8. Google said that EIN is sometimes called FED ID. You'd think they'd say so in one of the forms or instructions! :|

Edit 3: This thread is strangely inactive for April 15th.

 

[destrekor]

So last year was my first real rough year for taxes. Before it's always been a W2, or some years no W2 and no taxation since all my income was non-taxable (I love Army scholarships/stipends. And they love my soul.)

Last year I made some nice investment returns on short-term stock holdings, so I knew this would be hell.

It actually wasn't all that bad, provided I was okay with paying for services. Discount from Intuit from USAA, and the ability to import my 1099s, life was relatively easy besides inputting the cost basis (oddly enough that was left out for every sale).

So two questions:

One, the Feds want money from me. I knew they would, but I want to fight it through deductions if at all possible.

Problem is, my parents still claim me as a dependent (since I'm still in school, it helps all of us, they get the tax benefits and I get to stay under benefits from my parents... I think that's how it works. ).

Can I claim any deductions on college expenses? I went to enter the interest I paid on a student loan I paid off last year (with a far better loan ), which was a sizeable chunk of change. TurboTax said "sorry, no go. You said you were claimed as a dependent." Ugh.

Does it work that way for ALL college expenses? Even with the scholarships, I still have all debt on my name, and pay for everything college related on my own (some of it is with the non-taxable income, so that couldn't be included in the calculations, that I know).

But I either used some money earned from stock sale profits (had a huge run last year on a few stocks, reinvested most, have realized and unrealized losses that can go into next year's tax file), or money from loans entirely under my own name, no cosigners.

Also, any deductions for reinvesting money from profits? Say, reinvesting in the the same business later in the year, a similar business, or anything in general?

I saw something about small-business stocks, but I reckon even if the company is a microcap/penny-stock, it's still not technically a small business, yes?

Waiting till now? Yes and no. I've been really busy with school, and for the past week attempting to gather everything I would need and trying to understand all the rules and laws for what I needed to do for the things I've never done before.
Started yesterday, saved progress as I am attempting to figure some things out.

 

[Xcobra]

Alright, I'll throw my situation into the mix.

I was employed by a large company until June of 09. Until April I was a resident of IL, working in IA (and going to school). From April until June I moved back to IL (transferred locations), and worked there. I know that IL And IA are reciprocal states of one another.

I'm going to use some fake numbers here, but they will be close to the differences in what I'm seeing on my report.

For my W-2, they listed in box 1 that I made 15k. They also listed in box 16 what (in my mind) is the breakdown of those two states. Heres the problem: My IA shows 14.5k, and IL shows 4k...which in my mind is a total of 18.5k. From looking at my paystubs I only made the 15k throughout the year. Furthermore, if I look at my last paystub from in IA, it shows me at 10.5k for YTD.

It almost looks like when I transferred to IL, they put each one of my hours on IA AND IL. Only catch is they didn't do it for the taxes too, so now, according to my w2, it looks like I owe state money in IA (for time it says i worked and didn't get taxed on).


Does this make any sense to anyone? Trying to figure out if those numbers are actually right and I'm just not seeing it or if they screwed up in my transfer.

Thanks!

We are not answering state questions due to variability in the tax law. Although you would have to talk to your Payroll department. Also, if they have reciprocity then doesn't it mean only one state taxes you on the income (typically your home state)?

 

[Xcobra]

"Making Work Pay Credit" on 1040EZ keeps referencing the worksheet on the "back of the form" even though I am doing it electronically (has no "back"), but I followed the 1040EZ instructions PDF and got an amount that was just my earned wages (Box 1 from W2) PLUS the taxes taken from it (Box 2 from W2). Is that right? I mean, it gives an amount that is more than I earned, so I just want to be sure. I was all ready to skip the "Making work pay credit" line because I had no idea what that was and thought that it must not apply to me. All the questions in the instructions clearly didn't, but this is the figure I came up with. *shrug*

Edit: OK, this is supposed to go on my missing worksheet and not on the "Making Work Pay Credit" line. I found the worksheet and started it but I can't really get past the first thing... Employer's EIN. I have their "FED ID" number, and state ID number, but if FID number and Employer Identification Number are the same thing, they should say so! Otherwise, I don't know what they want. A little help?

Edit 2: DL'd the full 1040EZ to get the worksheet for line 8. Google said that EIN is sometimes called FED ID. You'd think they'd say so in one of the forms or instructions! :|

Edit 3: This thread is strangely inactive for April 15th.

Are you trying to calculate it manually? Schedule M is only one form and I think it's pretty easy to follow. Where are you stuck on? Also, yes FED ID and EIN are the same thing. Just your employer's ID number for the federal. They have a different ID for state.

EDIT: The whole amount is based on 400 or 800 if MFJ, prorated if over certain amounts (75000 or 15000 if MFJ). It asks you to put down your wages ONLY if it is $6,451 or LESS. If it's more, which I think it's the case, you enter 400 or 800.

 

[Xcobra]

I got a question for the pro tax guys.

If you buy, then sell your own things (think ebay) at a depreciated value, where is it that states you must file a tax return if you made more than $500 that year?

Overheard this at the CPA the other day but I don't know why is this the case.

Why would you want to report income on things you're selling at a loss? You have basis on those things. Granted, they won't let you take the loss but it is certainly no income to you. It's like selling your car for 12K when you bought it for 20K. How is that income? Anyways, unless selling things on ebay is your main form of business, then Sch C comes into play. My 2 cents.

 

[EagleKeeper]

So last year was my first real rough year for taxes. Before it's always been a W2, or some years no W2 and no taxation since all my income was non-taxable (I love Army scholarships/stipends. And they love my soul.)

Last year I made some nice investment returns on short-term stock holdings, so I knew this would be hell.

It actually wasn't all that bad, provided I was okay with paying for services. Discount from Intuit from USAA, and the ability to import my 1099s, life was relatively easy besides inputting the cost basis (oddly enough that was left out for every sale).

So two questions:

One, the Feds want money from me. I knew they would, but I want to fight it through deductions if at all possible.

Problem is, my parents still claim me as a dependent (since I'm still in school, it helps all of us, they get the tax benefits and I get to stay under benefits from my parents... I think that's how it works. ).

Can I claim any deductions on college expenses? I went to enter the interest I paid on a student loan I paid off last year (with a far better loan ), which was a sizeable chunk of change. TurboTax said "sorry, no go. You said you were claimed as a dependent." Ugh.

Does it work that way for ALL college expenses? Even with the scholarships, I still have all debt on my name, and pay for everything college related on my own (some of it is with the non-taxable income, so that couldn't be included in the calculations, that I know).

But I either used some money earned from stock sale profits (had a huge run last year on a few stocks, reinvested most, have realized and unrealized losses that can go into next year's tax file), or money from loans entirely under my own name, no cosigners.

Also, any deductions for reinvesting money from profits? Say, reinvesting in the the same business later in the year, a similar business, or anything in general?

I saw something about small-business stocks, but I reckon even if the company is a microcap/penny-stock, it's still not technically a small business, yes?

Waiting till now? Yes and no. I've been really busy with school, and for the past week attempting to gather everything I would need and trying to understand all the rules and laws for what I needed to do for the things I've never done before.
Started yesterday, saved progress as I am attempting to figure some things out.

If you are a dependant when filing; you can not claim the tuition related credits & student loan interest - that goes to the parents.

Investing money in a small business implies that you are participating in the business - not just buying stock in a business.