ATOT's Second Annual Tax Time Thread!

[archcommus]

My dad started a bussiness in 2004 which opened one month before the year's closing. Not much financially has been sorted yet. He got lots of packets from the IRS about filing business taxes and stuff, and he said he's allowed to report December of 04's earnings (for the business and himself) on 05's return, because of the largeness of the situation and the closeness to year's end.

I'm skeptical that this is permissible, though.

 

[joelmold]

thank you!

 

[EagleKeeper]

Originally posted by: archcommus87
My dad started a bussiness in 2004 which opened one month before the year's closing. Not much financially has been sorted yet. He got lots of packets from the IRS about filing business taxes and stuff, and he said he's allowed to report December of 04's earnings (for the business and himself) on 05's return, because of the largeness of the situation and the closeness to year's end.

I'm skeptical that this is permissible, though.

If he has documentation from Uncle indicating as such, no reason to be skeptical.

Otherwise if the business has only been open for 1 month, it should not be to difficult over the next 2-3 months to create the paperwork needed to file.
He can always file for an extension until August if needed.

 

[archcommus]

Originally posted by: EagleKeeper

Originally posted by: archcommus87
My dad started a bussiness in 2004 which opened one month before the year's closing. Not much financially has been sorted yet. He got lots of packets from the IRS about filing business taxes and stuff, and he said he's allowed to report December of 04's earnings (for the business and himself) on 05's return, because of the largeness of the situation and the closeness to year's end.

I'm skeptical that this is permissible, though.

If he has documentation from Uncle indicating as such, no reason to be skeptical.

Otherwise if the business has only been open for 1 month, it should not be to difficult over the next 2-3 months to create the paperwork needed to file.
He can always file for an extension until August if needed.

I'm not sure if his documentation states that or not. I asked him how he's going to get all that information together so soon, and he said it's fine to consider the business having started in 2005. I'm not quite sure if he's assuming this or not, though.

His 1040 has already been sent out, and the reason I'm concerned is because I filled out my FAFSA based on his tax return. If the IRS complains to him and makes him refile with December's earnings, I'm afraid it'll screw up my SAR.

 

[Wolfsraider]

Maybe you can answer a question for me:

I got injured and havent worked in 2004,
I live with my girlfriend and have for over 6 years
we have 3 children together
she is seperated not divorced.
Can I be claimed as a dependant on her taxes?
What forms would she need if she can

Thank you,

Mike

 

[EagleKeeper]

Originally posted by: Wolfsraider
Maybe you can answer a question for me:

I got injured and havent worked in 2004,
I live with my girlfriend and have for over 6 years
we have 3 children together
she is seperated not divorced.
Can I be claimed as a dependant on her taxes?
What forms would she need if she can

Thank you,

Mike

She would be able to file as Head of Household.
She will use a 1040A unless he situation requires Schedule A

With respect to your situation seepost of 01/25/2005 02:31 PM

 

[foolish501]

anybody able to help with something, already filed, friend of the family did it for me and my wife, because i got hit with having to pay taxes last year, i changed what i was claiming for, but also put away $50 each month extra, this shows on my W2 under field 12d as about $509. Is this money that is being withheld and given to the company i work for or being paid to the government ? because i cannot see this money mentioned anywhere on the tax filing, just on the W2

 

[EagleKeeper]

Originally posted by: foolish501
anybody able to help with something, already filed, friend of the family did it for me and my wife, because i got hit with having to pay taxes last year, i changed what i was claiming for, but also put away $50 each month extra, this shows on my W2 under field 12d as about $509. Is this money that is being withheld and given to the company i work for or being paid to the government ? because i cannot see this money mentioned anywhere on the tax filing, just on the W2

Tax S/W will ask you about 12D and use the money as additional tax withheld.
Without S/W you would have to enter it in the proper location. - In the area where the Form instructions asks you for Federal Taxes withheld/paid.

 

[Shimmishim]

I'm a graduate student and I see that under the "adjustment section" there is a box that I can check for Tuition and Fee deductions.

On my 1098-T form which shows how much I paid for tuition (box 2) and how much scholarship I received (box 4). Do I just subtract box 2 from box 4 to get my deduction?

 

[EagleKeeper]

Originally posted by: Shimmishim
I'm a graduate student and I see that under the "adjustment section" there is a box that I can check for Tuition and Fee deductions.

On my 1098-T form which shows how much I paid for tuition (box 2) and how much scholarship I received (box 4). Do I just subtract box 2 from box 4 to get my deduction?

Yes

 

[Wolfsraider]

Originally posted by: EagleKeeper

Originally posted by: Wolfsraider
Maybe you can answer a question for me:

I got injured and havent worked in 2004,
I live with my girlfriend and have for over 6 years
we have 3 children together
she is seperated not divorced.
Can I be claimed as a dependant on her taxes?
What forms would she need if she can

Thank you,

Mike

She would be able to file as Head of Household.
She will use a 1040A unless he situation requires Schedule A

With respect to your situation seepost of 01/25/2005 02:31 PM

Thanks for the info (I assume you were refering to 5:31pm and that it differs from state to state.
I will talk to the local irs,

 

[EagleKeeper]

Originally posted by: Wolfsraider

Originally posted by: EagleKeeper

Originally posted by: Wolfsraider
Maybe you can answer a question for me:

I got injured and havent worked in 2004,
I live with my girlfriend and have for over 6 years
we have 3 children together
she is seperated not divorced.
Can I be claimed as a dependant on her taxes?
What forms would she need if she can

Thank you,

Mike

She would be able to file as Head of Household.
She will use a 1040A unless he situation requires Schedule A

With respect to your situation see post of 01/25/2005 02:31 PM

Thanks for the info (I assume you were refering to 5:31pm and that it differs from state to state.
I will talk to the local irs,

Post refered to is based on Nevada time.

Local IRS will refer you to your state laws. That is what counts.

My gut is that as long as she is still legally married, the state law will be NO-NO.

 

[Yossarian]

thanks for your help! here's another one for you. if I bought a computer 2 years ago for biz purposes and started depreciating it over 5 years, am I under any obligation to continue the depreciation this year? can it just "disappear" from this return without showing any gain or loss?

 

[Lucky]

Was in accident 2 weeks ago. Doesn't look like insurance will reimburse for inherent diminished value of automobile after $6k in damage on new car. I've heard rumors of being able to deduct something the appraised DV on my taxes as unrealized loss or something. (obviously next year, not this year). Know anything about this?

thanks.

 

[EagleKeeper]

Originally posted by: Lucky
Was in accident 2 weeks ago. Doesn't look like insurance will reimburse for inherent diminished value of automobile after $6k in damage on new car. I've heard rumors of being able to deduct something the appraised DV on my taxes as unrealized loss or something. (obviously next year, not this year). Know anything about this?

thanks.

There is a line item for losses on the Schedule A/1040

However,
1) You must itemize - Using Schedule A/1010
2) The loss value listed must over $100 and the excess above 10% of your AGI.

Example Only:
$30K Income level
$4500 Loss of value

Writeoff is the excess of $3K = $1500

 

[CPA]

Originally posted by: Yossarian
thanks for your help! here's another one for you. if I bought a computer 2 years ago for biz purposes and started depreciating it over 5 years, am I under any obligation to continue the depreciation this year? can it just "disappear" from this return without showing any gain or loss?

generally only if you sell it or write it off as obsolete. if you don't mind me asking, why would you not want to include the depreciation?

 

[Yossarian]

Originally posted by: CPA

Originally posted by: Yossarian
thanks for your help! here's another one for you. if I bought a computer 2 years ago for biz purposes and started depreciating it over 5 years, am I under any obligation to continue the depreciation this year? can it just "disappear" from this return without showing any gain or loss?

generally only if you sell it or write it off as obsolete. if you don't mind me asking, why would you not want to include the depreciation?

I parted it out and sold & traded bits here and there, and bought pretty much an entirely new system last Jan. I think it would be easier to just forget about the old system and start fresh with depreciation on the new one.

btw turbotax's auto depreciation is messed up. form 2106, line 35 is $844, line 37 is $1041. line 38, enter the smaller of these two, it puts $1041

 

[CPA]

Originally posted by: Yossarian

Originally posted by: CPA

Originally posted by: Yossarian
thanks for your help! here's another one for you. if I bought a computer 2 years ago for biz purposes and started depreciating it over 5 years, am I under any obligation to continue the depreciation this year? can it just "disappear" from this return without showing any gain or loss?

generally only if you sell it or write it off as obsolete. if you don't mind me asking, why would you not want to include the depreciation?

I parted it out and sold & traded bits here and there, and bought pretty much an entirely new system last Jan. I think it would be easier to just forget about the old system and start fresh with depreciation on the new one.

btw turbotax's auto depreciation is messed up. form 2106, line 35 is $844, line 37 is $1041. line 38, enter the smaller of these two, it puts $1041

I'll have to get back to you on the form 2106 when I get home, but as far as the assets you should have calculated a gain/loss on the sale of your depreciable asset, then showed new depreciation with the new asset. It doesn't sound like you handled the asset accounting correctly.

 

[BaNzaiDags]

I'm doing my girlfriends taxes and for status i put my girlfriend as "head of household". when i read the description she does fit it and she did claim it last year when she had H&R do it for her. she has as daughter that she claims as dependent and she pays most of the bills in the house.

only thing is, the house is in my name. but its like im charger her rent.. so she is making the most payments in the house. im not claiming head of household, im claiming single.

any ideas?

btw last year she didn't leave with me.

 

[EagleKeeper]

Originally posted by: BaNzaiDags
I'm doing my girlfriends taxes and for status i put my girlfriend as "head of household". when i read the description she does fit it and she did claim it last year when she had H&R do it for her. she has as daughter that she claims as dependent and she pays most of the bills in the house.

only thing is, the house is in my name. but its like im charger her rent.. so she is making the most payments in the house. im not claiming head of household, im claiming single.

any ideas?

btw last year she didn't leave with me.

Ideas with respect for what.

Her situation is accurate.

You should put the house down as rental property, that way you can get depreciation and maintainence expenses written off.

Being single the Schedule E could be a big benefit in lowering your taxable income.
You can also find misc expenses that you can classify as being related to the rental.

Utilities, providing cable & internet access for the "tenant".
Proportional use of the vehicle with respect to the rental & related type expenses.

 

[BaNzaiDags]

Originally posted by: EagleKeeper

Originally posted by: BaNzaiDags
I'm doing my girlfriends taxes and for status i put my girlfriend as "head of household". when i read the description she does fit it and she did claim it last year when she had H&R do it for her. she has as daughter that she claims as dependent and she pays most of the bills in the house.

only thing is, the house is in my name. but its like im charger her rent.. so she is making the most payments in the house. im not claiming head of household, im claiming single.

any ideas?

btw last year she didn't leave with me.

Ideas with respect for what.

Her situation is accurate.

You should put the house down as rental property, that way you can get depreciation and maintainence expenses written off.

Being single the Schedule E could be a big benefit in lowering your taxable income.
You can also find misc expenses that you can classify as being related to the rental.

Utilities, providing cable & internet access for the "tenant".
Proportional use of the vehicle with respect to the rental & related type expenses.

but then wouldn't i have to claim income from renting?

I'm not sure if i made this clear or not, but its not my daughter, its my girlfriends daughter that lives with that. im not sure if that matters.

 

[EagleKeeper]

Originally posted by: BaNzaiDags

Originally posted by: EagleKeeper

Originally posted by: BaNzaiDags
I'm doing my girlfriends taxes and for status i put my girlfriend as "head of household". when i read the description she does fit it and she did claim it last year when she had H&R do it for her. she has as daughter that she claims as dependent and she pays most of the bills in the house.

only thing is, the house is in my name. but its like im charger her rent.. so she is making the most payments in the house. im not claiming head of household, im claiming single.

any ideas?

btw last year she didn't leave with me.

Ideas with respect for what.

Her situation is accurate.

You should put the house down as rental property, that way you can get depreciation and maintainence expenses written off.

Being single the Schedule E could be a big benefit in lowering your taxable income.
You can also find misc expenses that you can classify as being related to the rental.

Utilities, providing cable & internet access for the "tenant".
Proportional use of the vehicle with respect to the rental & related type expenses.

but then wouldn't i have to claim income from renting?

I'm not sure if i made this clear or not, but its not my daughter, its my girlfriends daughter that lives with that. im not sure if that matters.

The amont of income from rental should be less than the overall benifit from using the Schedule E.

Girlfriends daughter allows her to claim Head of Household.

If they were "living with you" then that would be a different scenario. Only one Head of Household can claim a dependant.

 

[mugs]

Can I take money out of a Roth IRA with no penalty if I'm using it to purchase my first home?

 

[EagleKeeper]

Originally posted by: mugs
Can I take money out of a Roth IRA with no penalty if I'm using it to purchase my first home?

<a target=_blank class=ftalternatingbarlinklarge href="http://www.irs.gov/taxtopics/tc428.html">IRS - FAQ - Roth IRA Distributions
</a>

A qualified distribution is generally, any payment or distribution made after the 5?taxable?year period beginning with the first year for which a contribution was made to a Roth IRA set up for you, and that is made on or after you reach age 59 1/2, made because you are disabled, made to a beneficiary or to your estate after your death, or that is made to buy, build, or rebuild a first home.

A distribution used to buy, build or rebuild a first home must be used to pay qualified costs for the main home of a first time home buyer who is either yourself, your spouse, or you or your spouse's child, grandchild, parent, or other ancestor. When added to all your prior qualified first?time homebuyer distributions, if any, the total distributions cannot be more than $10,000.

Part of any distribution that is not a qualified distribution may be taxable as ordinary income and subject to the additional 10% tax on early distributions. Distributions of conversion contributions within a 5?year period following a conversion may be subject to the 10% early distribution tax, even if the contributions have been included as income in an earlier year. Refer to Topic 558 , Early Distributions from IRA's, for more information.

 

[JohnCU]

I'm a college student who has a job in South Carolina, but during the summer had an internship in North Carolina (where I made a substantial amount of money, $7200).

1. Can I still use 1040EZ?
2. Will I get most of the money back?
3. If my mom claims me, does that mean I can't deduct my books, tuition, etc on my taxes?