ATOT's Second Annual Tax Time Thread!

[EagleKeeper]

Originally posted by: Lazee

Originally posted by: EagleKeeper

Originally posted by: Lazee
Wow this is cutting it close.

Questions please.

Mother in USA with me. Father in foreign country.
They are filing Married but filing separately.
Mother - savings account interest.
Father - savings and retirement fund (1099-int and R)

Easy stuff. However I have filed Mother as a dependent under me since she has no real income and i pay more then 50% of everything in the home. My father's filing through Turbotax was rejected today. Me and my mother's was Accepted.

Error Code 0509: The secondary taxpayer's social security number was used as a dependent's social security number or used as qualifying child's social security number on Schedule EIC on the current return or a previous return. <OR> The dependent's social security number was used as a secondary taxpayer's social security number on the current return or a previous return. <OR> The qualifying child's social security number on Schedule EIC was used as a secondary taxpayer's social security number on the current return or a previous return.

Did I do something wrong? Because I filed my mother as a dependent under me, were they allowed to file married but separate ?

edit: apparently i have to do it by mail. nevermind, thanks

Nope - Married Seperately voids using a parent as a dependent.

You Dad will have to file as Single to get around that roadblock.

He's legally considered married though. won't that create problems filing as single?

You have already created the problem by claiming your parent as an dependent.

A person can be be classified as a dependent of two people at the same time. Being classified as married-seperately is supposed to prevent that person from being a dependent. Look closely at the rules for dependency.

IRS - FAQ - Dependency

Married persons living apart. If you live apart from your spouse and meet certain tests, you may be considered unmarried.

Nonresident alien spouse. You are considered unmarried for head of household purposes if your spouse was a nonresident alien at any time during the year and you do not choose to treat your nonresident spouse as a resident alien.

 

[new2AMD]

I was told by someone who has been doing it for years now that you can skip a year of filing your state tax. Is this true? So like I could skip this year and file next year and this years state tax next april?

 

[EagleKeeper]

Originally posted by: new2AMD
I was told by someone who has been doing it for years now that you can skip a year of filing your state tax. Is this true? So like I could skip this year and file next year and this years state tax next april?

That is up to your state laws.

I suspect that that will only work if you are owed a refund from the state.

You may have to pay a penalty if you do not file.

Most people that spout such baloney never actually do what they say or have lucked outed, or do not tell you the whole story.

How would you like to have your paycheck held up a pay period just because accounting does not feel like processing it? Same way the state revenue departments works.

 

[CPA]

Originally posted by: RossMAN

Originally posted by: CPA

Originally posted by: RossMAN
If I file my taxes 1 week late what kind of fees/penalties should I expect?

You will get a major ass raping....

Actually, penalty is .5 percent per month and interest is 5 percent per month compounded daily.

You can avoid most of this by filing an extension and paying an estimated amount. Then when you do file you will only pay penalty and interest on the difference.

Can I pay the amount I owe (actually I think I'm getting a refund for fed but owe on state) 1 week late then they send me a bill for the penalties/interest?

sure, though you leave the calculation up to them. I would rather calculate my own interest and penalties.

 

[CPA]

Originally posted by: razor2025
I searched the thread and didn't find anything regarding scholarships.

I'm currently enrolled in a state college and I have a state-wide scholarship that pays all of my tuition and small part of book fees / other fees. If you're familiar with GA's HOPE scholarship, that's what I'm receiving. I'm also getting about $900/yr Pell Grant to supplement the expenses. I received my 1098-T form few weeks ago and was puzzled at the numbers. My total educational expense was ~$4k on the form, but I only received $2700 in scholarship according to the form. I didn't pay anything to cover the reaminder according to the form (which is true, because somehow, they missed the Pell Grant and HOPE Book allownace / school fees).

So, here's the question. If I receive a state-scholarship that covers only whatever I'm charged by a state college (as far as tuition goes) and also Federal Grant, do I need to report the total amount scholarship on my tax? I thought that if scholarship < total expense, then you didn't need to report the scholarship. Also, is my 1098-T form incorrect? I've called my school's bursur office and they said it was correct.

Any help is appreciated.

razor, sorry about the delay in answering this.

I'm not sure I understand your question completely. I will say that need-based scholarships (Pell Grant, for example) are tax-free if used for educational expenses. It seems, based on the information that you provided, that all of the grants were used for educational purposes (as opposed to rent, car payments, insurance, etc.) and, therefore, are tax exempt.

If this was the only income your received, then you won't have to file at all. Only taxable amounts need to be reported.

 

[Banana]

Not a filing question, but a question nonetheless for the future:

If I form a one-man corporation, how do I pay myself? Do I need to do a W-2, W-3, W-4, W-whatever? If I write myself a paycheck, how do I figure out the amounts to subtract (income tax, social security, medicare, etc)? And if I happen to figure that out, do I send one payment to the IRS with a 1040ES?

 

[Fern]

Originally posted by: Banana
Not a filing question, but a question nonetheless for the future:

If I form a one-man corporation, how do I pay myself? Do I need to do a W-2, W-3, W-4, W-whatever? If I write myself a paycheck, how do I figure out the amounts to subtract (income tax, social security, medicare, etc)? And if I happen to figure that out, do I send one payment to the IRS with a 1040ES?

Two ways to pay yourself: (1) Salary and (2) dividends. Yeah, salary w/b reported to you on W-2. Form W-3 for transmitting the W-2 from the company to the IRS.

If you're one-man corp, elect to be taxed as an S-corp.

I use software to calculate fed & state w/h etc for our clients. I believe IRS Publication Circular E has the withholding tables if you wanna do it manually. The amounts for fed w/h and SS are paid in periodically, how often/frequently is determined by the amount to be deposited. You'll get a special deposit ticket from the IRS for these payroll taxes. Take it and the payment to your bank. Banks have IRS accounts to receive such funds.

Basically same for state w/h taxes.


Actually, I hate payroll and don't do it. Other peeps in my office handle it.

Fern

 

[razor2025]

Originally posted by: CPA

razor, sorry about the delay in answering this.

I'm not sure I understand your question completely. I will say that need-based scholarships (Pell Grant, for example) are tax-free if used for educational expenses. It seems, based on the information that you provided, that all of the grants were used for educational purposes (as opposed to rent, car payments, insurance, etc.) and, therefore, are tax exempt.

If this was the only income your received, then you won't have to file at all. Only taxable amounts need to be reported.

Thanks for the advice, to make it clear here's how my finance are broken down.

I'm claimed as dependent by my parents, because I'm full-time student.
I receive need-based scholarship (Pell Grant) and state-wide scholarship (HOPE), that all goes towards my tuition, books, and related school fees.
I've also worked during the Summer of 2004 before school, and earned about $3000 with about $500 withheld. $300 are federal income tax, and $200 are SS and Medicare.

Here's the wierd thing, the school I goto, GA Tech, takes all of my scholarship awards and use it to pay for the tuition and student fees. That means Pell Grant and HOPE book allowance are used to pay for part of my total school fees. However, because HOPE pays more than enough to cover the tuition and fees, I receive a good $600 / semester in refund from school. The amount the school did not need to use to pay for their mandatory fees. I use up most of that money on book and school supplies. So that's why I'm wondering whether I should consider that $600 refund as income or not. I don't think I need to report it as that $600 refund is used for books which should be "related expenses" category.

I'm filing my taxes, simply because I want my $300 federal income tax refund. Since I"m under 21 and make less than $10000/yr, I'm income tax-exempt (for now).

Thanks alot CPA for helping me out.

 

[mundane]

Thanks to all who contributed their time and effort here to give us guidance. It's good to know there's people willing to help with professional (if unofficial) advice for the community.

 

[PMFleXXX]

if i made money in tx (internship) and pa (campus job), but have my permanent address in MD (where I made no money), in which state(s) do i have to file taxes? TX has no state tax, i had a couple hundred withheld in PA, and haven't done anything in MD.

I believe I should only be filing PA, but TurboTax for some reason keeps saying i should pay taxes on my gross income (including what i made in TX) and not just what i made in PA. Thus, I owe PA a hefty amount in taxes! Is this right?

Thanks!

 

[EagleKeeper]

Originally posted by: razor2025

Originally posted by: CPA

razor, sorry about the delay in answering this.

I'm not sure I understand your question completely. I will say that need-based scholarships (Pell Grant, for example) are tax-free if used for educational expenses. It seems, based on the information that you provided, that all of the grants were used for educational purposes (as opposed to rent, car payments, insurance, etc.) and, therefore, are tax exempt.

If this was the only income your received, then you won't have to file at all. Only taxable amounts need to be reported.

Thanks for the advice, to make it clear here's how my finance are broken down.

I'm claimed as dependent by my parents, because I'm full-time student.
I receive need-based scholarship (Pell Grant) and state-wide scholarship (HOPE), that all goes towards my tuition, books, and related school fees.
I've also worked during the Summer of 2004 before school, and earned about $3000 with about $500 withheld. $300 are federal income tax, and $200 are SS and Medicare.

Here's the wierd thing, the school I goto, GA Tech, takes all of my scholarship awards and use it to pay for the tuition and student fees. That means Pell Grant and HOPE book allowance are used to pay for part of my total school fees. However, because HOPE pays more than enough to cover the tuition and fees, I receive a good $600 / semester in refund from school. The amount the school did not need to use to pay for their mandatory fees. I use up most of that money on book and school supplies. So that's why I'm wondering whether I should consider that $600 refund as income or not. I don't think I need to report it as that $600 refund is used for books which should be "related expenses" category.

I'm filing my taxes, simply because I want my $300 federal income tax refund. Since I"m under 21 and make less than $10000/yr, I'm income tax-exempt (for now).

Thanks alot CPA for helping me out.

If the extra funds returned by the school was used for educational expenses (as intended by the Grants), then you do not need to declare them as income.

File your taxes as a dependant and DO NOT select the educational credits.

 

[EagleKeeper]

Originally posted by: PMFleXXX
if i made money in tx (internship) and pa (campus job), but have my permanent address in MD (where I made no money), in which state(s) do i have to file taxes? TX has no state tax, i had a couple hundred withheld in PA, and haven't done anything in MD.

I believe I should only be filing PA, but TurboTax for some reason keeps saying i should pay taxes on my gross income (including what i made in TX) and not just what i made in PA. Thus, I owe PA a hefty amount in taxes! Is this right?

Thanks!

TurboTax is a pain when you cross states as are most Tax S/W packages (both online and offline)

The best way is to treat it as a move from TX to PA.

OR

You have to manually let PA know that you had excluded income in TX.


IF this does not work, you will have to did into the TurboTax help system to find out how to tell it that you have excluded state income. And it may not accept it, becuase no tax was paid on that other income.

 

[Hossenfeffer]

RE: Performing Artist


So I'm already going through all the self-loathing for my terrible (Read: non-existant record keeping). Doing my best to estimate possible deductions (I've yet to venture into the realm of vehicle deductions... bleh), and I get asked "Are you a 'qualified performing artist?" Naturally, I assume yes, because I am an actor, after all. I was lucky enough to be a part of 3 school tours (over the course of 7 months), as well as 3 larger, night-time productions. Well, also "lucky" enough to finally make more than $12,000 for the first time in my life. (Yeah, laugh all ya want ). And apparently (or at least I'm assuming) I can't deduct the performing artist stuff if I made more than $16,000 AGI. With the 3 employers, I grossed just under $21,000. Can I still deduct things like headshots, makeup, and such?

Will check the thread, but a PM/Email would be great if anybody has a nifty answer. Broke down and bought TaxCut and am stuck at owing $1,200 on a joint married return (She's also an actress, though she also works as a server)


edit: Bleh, -assuming- I can still deduct the stuff, it just doesn't count for the qualified performing artist thing.

edit 2: Any recommendations on the best way to just learn this stuff? I hate feeling like a dweeb every time tax season comes around. I imagine simply keeping records would alleviate a bunch of that, but let's say I take it in another direction.... what's it take to become a CPA?

 

[The Sauce]

Originally posted by: EagleKeeper

Originally posted by: Snatchface
Am I required to file State taxes for my stepdaughter? She made a total of $2325 in PA and $896 in WV. It would suck to have to file two state returns for such measley income.

You are not required to file for her.

She should determine if she is required to file.
If taxes are owed to the Fed or a state, then she must file.
If she chooses to ignore a refund, then that is up to her.

Well my question was not so much "Do I need to file for her," but rather do we (her or me) need to file for her at all with that income level? I am doing her taxes for her. I was not sure if you even needed to file state taxes at that income level.

 

[EagleKeeper]

Originally posted by: Hossenfeffer
RE: Performing Artist


So I'm already going through all the self-loathing for my terrible (Read: non-existant record keeping). Doing my best to estimate possible deductions (I've yet to venture into the realm of vehicle deductions... bleh), and I get asked "Are you a 'qualified performing artist?" Naturally, I assume yes, because I am an actor, after all. I was lucky enough to be a part of 3 school tours (over the course of 7 months), as well as 3 larger, night-time productions. Well, also "lucky" enough to finally make more than $12,000 for the first time in my life. (Yeah, laugh all ya want ). And apparently (or at least I'm assuming) I can't deduct the performing artist stuff if I made more than $16,000 AGI. With the 3 employers, I grossed just under $21,000. Can I still deduct things like headshots, makeup, and such?

Will check the thread, but a PM/Email would be great if anybody has a nifty answer. Broke down and bought TaxCut and am stuck at owing $1,200 on a joint married return (She's also an actress, though she also works as a server)


edit: Bleh, -assuming- I can still deduct the stuff, it just doesn't count for the qualified performing artist thing.

edit 2: Any recommendations on the best way to just learn this stuff? I hate feeling like a dweeb every time tax season comes around. I imagine simply keeping records would alleviate a bunch of that, but let's say I take it in another direction.... what's it take to become a CPA?

Did you get paid via W2 or another method.

If you got paid as W2, then you will have to itemize.

All those misc epxenses that you paid for to get yourself noticed would fall as business expenses.

If paid by W2, then you will have to itemize and use Schedule A/form 2106 to get any benefit.

If paid otherwise, then you can use the Schedule C for income and expenses and therefore not have to worry about itemization just to cover your expenses.


When two people are working, it is best for at least one of them to take 1 less exemptions on their W4 payroll unless there is the disipline to put extr the $$ aside during the year for any tax owed.

If one wants to lose their creativity and become a paperpusher, you should contact CPA.
Based on another thread here, at least those types can get/keep the hot chicks.:Q

 

[Fern]

Originally posted by: PMFleXXX
if i made money in tx (internship) and pa (campus job), but have my permanent address in MD (where I made no money), in which state(s) do i have to file taxes? TX has no state tax, i had a couple hundred withheld in PA, and haven't done anything in MD.

I believe I should only be filing PA, but TurboTax for some reason keeps saying i should pay taxes on my gross income (including what i made in TX) and not just what i made in PA. Thus, I owe PA a hefty amount in taxes! Is this right?

Thanks!

Notwithstanding any tax software issues, you should first determine in which state you are considered a resident. That state will likely require that you declare all income, no matter the source. Your state of residency will then give you a credit for taxes paid to another state where you made income. This of course causes problems when you earn money in a state with no personal income taxes like TX (there's no credit available, because there were no taxes paid to TX).

Be careful about Maryland. I had a client who moved from there to NY for a short while (not long enough to be a NY resident), and was then sent by the NY employer to Hong Kong for several years. When he returned Maryland wanted taxes for the income earned in HK, because Maryland cliamed he was still resident while living in HK for several years.

Cliff Notes: You're likely a resident in either ML or PA, and they will likely claim (correctly under tax law) that you owe them taxes on income earned in TX.

(Been a while ince I've done ML or PA taxes, so if another CPA has updated info on this, please chime in)

Fern

 

[cronos]

quick question.
my wife needs to file a W-7 so she can get an ITIN (we're filing jointly with her having no income - no SSN - not allowed to have a job because of visa restrictions). the instruction for W-7 says that i should send the W-7 together with the whole tax return forms to a special address (special address for ITIN registration), and then after they assigned my wife an ITIN, they will forward it to the correct place to get the return processed.

my question: since i am just sending these forms to the W-7 address today, obviously the 'normal tax-return address' is not going to get my return forms on time, should i file an extension then? or will they understand what's going on?

thanks so much.

 

[Hossenfeffer]

Originally posted by: EagleKeeper
Did you get paid via W2 or another method.

If you got paid as W2, then you will have to itemize.

All those misc epxenses that you paid for to get yourself noticed would fall as business expenses.

If paid by W2, then you will have to itemize and use Schedule A/form 2106 to get any benefit.

If paid otherwise, then you can use the Schedule C for income and expenses and therefore not have to worry about itemization just to cover your expenses.


When two people are working, it is best for at least one of them to take 1 less exemptions on their W4 payroll unless there is the disipline to put extr the $$ aside during the year for any tax owed.

If one wants to lose their creativity and become a paperpusher, you should contact CPA.
Based on another thread here, at least those types can get/keep the hot chicks.:Q

Was paid on W-2's for all except one show, each of us had 3 W-2's. Tried to go through and think up all the things I paid, but couldn't come near the $9,000 or so deduction. Didn't get into the vehicles we use to go from job to job or anything. That had me wondering why I even went into all of that.

Partner in a business that operated at a slight loss as well. Total newbie on what all I need to be including on -my- taxes. My biz partner has much more experience and did the biz taxes for us.

Will definitely be changing my W4 allowances to 0 (have been 1 as long as I can remember), thanks for the advice.

While I can't imagine ever giving up acting, I sure wouldn't mind doing some sort of intensive in paperpushin

 

[CPA]

Originally posted by: saxguy
quick question.
my wife needs to file a W-7 so she can get an ITIN (we're filing jointly with her having no income - no SSN - not allowed to have a job because of visa restrictions). the instruction for W-7 says that i should send the W-7 together with the whole tax return forms to a special address (special address for ITIN registration), and then after they assigned my wife an ITIN, they will forward it to the correct place to get the return processed.

my question: since i am just sending these forms to the W-7 address today, obviously the 'normal tax-return address' is not going to get my return forms on time, should i file an extension then? or will they understand what's going on?

thanks so much.

That's a good question.

Normally, IRS considers taxes are filed when mailed (ie, date stamped by or on the 15th). In this case, I'm not sure if the same applies. Best bet is to call the IRS to confirm. My suspicions are that they will not penalize you and it will be considered timely filed.

 

[CPA]

Originally posted by: Snatchface

Originally posted by: EagleKeeper

Originally posted by: Snatchface
Am I required to file State taxes for my stepdaughter? She made a total of $2325 in PA and $896 in WV. It would suck to have to file two state returns for such measley income.

You are not required to file for her.

She should determine if she is required to file.
If taxes are owed to the Fed or a state, then she must file.
If she chooses to ignore a refund, then that is up to her.

Well my question was not so much "Do I need to file for her," but rather do we (her or me) need to file for her at all with that income level? I am doing her taxes for her. I was not sure if you even needed to file state taxes at that income level.

snatch, we generally don't answer state questions here because of the complexity and differences between states. Best bet is to search for your state's tax website and see what they're filing requirements are.

 

[Zee]

Originally posted by: EagleKeeper

Originally posted by: Lazee

Originally posted by: EagleKeeper

Originally posted by: Lazee
Wow this is cutting it close.

Questions please.

Mother in USA with me. Father in foreign country.
They are filing Married but filing separately.
Mother - savings account interest.
Father - savings and retirement fund (1099-int and R)

Easy stuff. However I have filed Mother as a dependent under me since she has no real income and i pay more then 50% of everything in the home. My father's filing through Turbotax was rejected today. Me and my mother's was Accepted.

Error Code 0509: The secondary taxpayer's social security number was used as a dependent's social security number or used as qualifying child's social security number on Schedule EIC on the current return or a previous return. <OR> The dependent's social security number was used as a secondary taxpayer's social security number on the current return or a previous return. <OR> The qualifying child's social security number on Schedule EIC was used as a secondary taxpayer's social security number on the current return or a previous return.

Did I do something wrong? Because I filed my mother as a dependent under me, were they allowed to file married but separate ?

edit: apparently i have to do it by mail. nevermind, thanks

Nope - Married Seperately voids using a parent as a dependent.

You Dad will have to file as Single to get around that roadblock.

He's legally considered married though. won't that create problems filing as single?

You have already created the problem by claiming your parent as an dependent.

A person can be be classified as a dependent of two people at the same time. Being classified as married-seperately is supposed to prevent that person from being a dependent. Look closely at the rules for dependency.

IRS - FAQ - Dependency

Married persons living apart. If you live apart from your spouse and meet certain tests, you may be considered unmarried.

Nonresident alien spouse. You are considered unmarried for head of household purposes if your spouse was a nonresident alien at any time during the year and you do not choose to treat your nonresident spouse as a resident alien.

Im sorry but I read that page 3 times and i dont understand where the problem lies. According to table 4, since i can claim my mother as an exemption, why does that void my father's married but separate return? I can't find where it says that if 2 parents are filing married but separate, then one of them can't be my dependent.

Help please?

Thank you so much in advance...

 

[PMFleXXX]

Originally posted by: Fern

Originally posted by: PMFleXXX
if i made money in tx (internship) and pa (campus job), but have my permanent address in MD (where I made no money), in which state(s) do i have to file taxes? TX has no state tax, i had a couple hundred withheld in PA, and haven't done anything in MD.

I believe I should only be filing PA, but TurboTax for some reason keeps saying i should pay taxes on my gross income (including what i made in TX) and not just what i made in PA. Thus, I owe PA a hefty amount in taxes! Is this right?

Thanks!

Notwithstanding any tax software issues, you should first determine in which state you are considered a resident. That state will likely require that you declare all income, no matter the source. Your state of residency will then give you a credit for taxes paid to another state where you made income. This of course causes problems when you earn money in a state with no personal income taxes like TX (there's no credit available, because there were no taxes paid to TX).

Be careful about Maryland. I had a client who moved from there to NY for a short while (not long enough to be a NY resident), and was then sent by the NY employer to Hong Kong for several years. When he returned Maryland wanted taxes for the income earned in HK, because Maryland cliamed he was still resident while living in HK for several years.

Cliff Notes: You're likely a resident in either ML or PA, and they will likely claim (correctly under tax law) that you owe them taxes on income earned in TX.

(Been a while ince I've done ML or PA taxes, so if another CPA has updated info on this, please chime in)

Fern

Originally posted by: EagleKeeper
TurboTax is a pain when you cross states as are most Tax S/W packages (both online and offline)

The best way is to treat it as a move from TX to PA.

OR

You have to manually let PA know that you had excluded income in TX.


IF this does not work, you will have to did into the TurboTax help system to find out how to tell it that you have excluded state income. And it may not accept it, becuase no tax was paid on that other income.

I'm confused now, should or should I not be paying taxes on income that I earned in Texas? And am I supposed to file just in my state of residency, or wherever I earned income?

Thanks!

 

[EagleKeeper]

Originally posted by: Lazee

Originally posted by: EagleKeeper

Originally posted by: Lazee

Originally posted by: EagleKeeper

Originally posted by: Lazee
Wow this is cutting it close.

Questions please.

Mother in USA with me. Father in foreign country.
They are filing Married but filing separately.
Mother - savings account interest.
Father - savings and retirement fund (1099-int and R)

Easy stuff. However I have filed Mother as a dependent under me since she has no real income and i pay more then 50% of everything in the home. My father's filing through Turbotax was rejected today. Me and my mother's was Accepted.

Error Code 0509: The secondary taxpayer's social security number was used as a dependent's social security number or used as qualifying child's social security number on Schedule EIC on the current return or a previous return. <OR> The dependent's social security number was used as a secondary taxpayer's social security number on the current return or a previous return. <OR> The qualifying child's social security number on Schedule EIC was used as a secondary taxpayer's social security number on the current return or a previous return.

Did I do something wrong? Because I filed my mother as a dependent under me, were they allowed to file married but separate ?

edit: apparently i have to do it by mail. nevermind, thanks

Nope - Married Seperately voids using a parent as a dependent.

You Dad will have to file as Single to get around that roadblock.

He's legally considered married though. won't that create problems filing as single?

You have already created the problem by claiming your parent as an dependent.

A person can be be classified as a dependent of two people at the same time. Being classified as married-seperately is supposed to prevent that person from being a dependent. Look closely at the rules for dependency.

IRS - FAQ - Dependency

Married persons living apart. If you live apart from your spouse and meet certain tests, you may be considered unmarried.

Nonresident alien spouse. You are considered unmarried for head of household purposes if your spouse was a nonresident alien at any time during the year and you do not choose to treat your nonresident spouse as a resident alien.

Im sorry but I read that page 3 times and i dont understand where the problem lies. According to table 4, since i can claim my mother as an exemption, why does that void my father's married but separate return? I can't find where it says that if 2 parents are filing married but separate, then one of them can't be my dependent.

Help please?

Thank you so much in advance...

When one files as married filing seperately, one has to include the spouse's SS#;
the other spouse must also filed as married seperately.

By you claiming your mother as a dependant, she she canot do this; it creates a conflict.

Therefore for your father to file, he must fileg as single becuase you have already claimed your mother.

The guidelines contain an exceptions which allows this condition between your parents.

 

[EagleKeeper]

Originally posted by: PMFleXXX

Originally posted by: Fern

Originally posted by: PMFleXXX
if i made money in tx (internship) and pa (campus job), but have my permanent address in MD (where I made no money), in which state(s) do i have to file taxes? TX has no state tax, i had a couple hundred withheld in PA, and haven't done anything in MD.

I believe I should only be filing PA, but TurboTax for some reason keeps saying i should pay taxes on my gross income (including what i made in TX) and not just what i made in PA. Thus, I owe PA a hefty amount in taxes! Is this right?

Thanks!

Notwithstanding any tax software issues, you should first determine in which state you are considered a resident. That state will likely require that you declare all income, no matter the source. Your state of residency will then give you a credit for taxes paid to another state where you made income. This of course causes problems when you earn money in a state with no personal income taxes like TX (there's no credit available, because there were no taxes paid to TX).

Be careful about Maryland. I had a client who moved from there to NY for a short while (not long enough to be a NY resident), and was then sent by the NY employer to Hong Kong for several years. When he returned Maryland wanted taxes for the income earned in HK, because Maryland cliamed he was still resident while living in HK for several years.

Cliff Notes: You're likely a resident in either ML or PA, and they will likely claim (correctly under tax law) that you owe them taxes on income earned in TX.

(Been a while ince I've done ML or PA taxes, so if another CPA has updated info on this, please chime in)

Fern

Originally posted by: EagleKeeper
TurboTax is a pain when you cross states as are most Tax S/W packages (both online and offline)

The best way is to treat it as a move from TX to PA.

OR

You have to manually let PA know that you had excluded income in TX.


IF this does not work, you will have to did into the TurboTax help system to find out how to tell it that you have excluded state income. And it may not accept it, becuase no tax was paid on that other income.

I'm confused now, should or should I not be paying taxes on income that I earned in Texas? And am I supposed to file just in my state of residency, or wherever I earned income?

Thanks!

Texas has no income tax.
Some states will credit your for taxes paid to a different state. Because you have no credits for TX, then you are essentially being taxed (as you noted) on you complete income.

PA is not delinating between where the income was earned; just looking at the total income and how much tax was paid on that income.

By filing as a split resident, then PA should only tax your on income earned while living and working in PA.

 

[rudeguy]

just wanted to pop in and thank you guys again for all your help. We all owe you a big thanks and an even bigger :beer: