3rd Annual AT Tax Time Thread

[captains]

can anything be deducted for remodeling my house ......isulation, flooring, doors, a/c...crap like that or is that only for resale purposes

 

[EagleKeeper]

Originally posted by: captains
can anything be deducted for remodeling my house ......isulation, flooring, doors, a/c...crap like that or is that only for resale purposes

Not unless used for rental.

 

[chimmytime]

Hello and thank ahead of time.

This year I had a normal 8-5 job, but also freelance on the side for the first time. I'm used to filing the 1040ez form, but i figured i would need a different form this year, because i would like to deduct my hardware i bought for my freelance work. Is there a website that can give me the dumb downed information about how to calculate all of this?

 

[EagleKeeper]

Originally posted by: chimmytime
Hello and thank ahead of time.

This year I had a normal 8-5 job, but also freelance on the side for the first time. I'm used to filing the 1040ez form, but i figured i would need a different form this year, because i would like to deduct my hardware i bought for my freelance work. Is there a website that can give me the dumb downed information about how to calculate all of this?

2005 Tax Thread
2004 Tax Thread
2003 Tax Thread
IRS -Schedule C Instructions

 

[GuitarDaddy]

My first post here seeking you sage advise.

I'm a fellow accountant (cost mgr/mfg controller), I did tax prep for a local CPA firm right out of college for a couple of years(20+ years ago) before I moved to industry. I've kept up with the basics over the years and have been doing taxes for a few family members and friends every year, 1040.s schC's, E, etc... One of which includes my mother-in-law and father-in-law.

My father-in-law passed away on Jan 02.2006 and my question is: Am I correct to assume that this won.t affect the filing of the 2005 return?, And should I file a normal MFJ return for them?

And for the 2006 return what additional forms will I need? Estate taxes,etc.., or will this be the responsibility of the executor(family lawyer):?

Any advise would be appreciated

 

[myusername]

Thanks EagleKeeper!

turns out I was misreading my W-2

3. You cannot deduct elective deferrals
to a ... SIMPLE plan ... These amounts are not included as income in Form W-2, box 1.

 

[ironk]

Are selling things on anandtech "For Sale" forums or a few things every now and then on ebay supposed to be reported as an income? I mean, i sell computer components i no longer need since i have upgraded to better equipment....sold about 5-6 items in 2005.

Thx.

 

[GuitarDaddy]

Originally posted by: ironk
Are selling things on anandtech "For Sale" forums or a few things every now and then on ebay supposed to be reported as an income? I mean, i sell computer components i no longer need since i have upgraded to better equipment....sold about 5-6 items in 2005.

Thx.

No, is the short answer

 

[EagleKeeper]

Originally posted by: GuitarDaddy
My first post here seeking you sage advise.

I'm a fellow accountant (cost mgr/mfg controller), I did tax prep for a local CPA firm right out of college for a couple of years(20+ years ago) before I moved to industry. I've kept up with the basics over the years and have been doing taxes for a few family members and friends every year, 1040.s schC's, E, etc... One of which includes my mother-in-law and father-in-law.

My father-in-law passed away on Jan 02.2006 and my question is: Am I correct to assume that this won.t affect the filing of the 2005 return?, And should I file a normal MFJ return for them?

And for the 2006 return what additional forms will I need? Estate taxes,etc.., or will this be the responsibility of the executor(family lawyer):?

Any advise would be appreciated

As long as he was alive during any time during the year, the spouse is allowed to file a MFJ return.
Therefore she can file MFJ for 2005 and 2006.

The estate is responsible for filing the proper tax forms (if any) for 2006 returns.

 

[EagleKeeper]

Originally posted by: myusername
Back when I enrolled in my SIMPLE IRA 4 years ago, I misread IRS docs and came to conclusion that I did *not* deduct my contributions, so I just submitted a 1040EZ

In a moment of clarity about 7 minutes ago, I have realized that this is not the case

I still have to run a 1040A itemized to see if it makes a difference on the 1040EZ (IRA and health ins. are my only deductions) , but assuming there is a savings ...

Can I re-submit prior years tax returns, and if so, should I (I.E. will it make the IRS grumpy at me in the future)

You will need to file a 1040X for each year that you need to modify. However, you can only go back 3 years.

 

[dxkj]

My wife and I bought a house in June, halfway through the year. Also halfway through the year we moved states. She switched jobs, worked 6 months at once place, 2 months off, and then started Grad school where she works for the school in an Assistanceship. Most of her Tuition is covered by the school, we Pay X dollars, and they give us X dollars for what we pay, but there are additional fees for the education, and books that we buy. I believe for this year books will add up to $400 and additional college fees/payments $500. She had made $3000 working for the college in the Assistanceship and it doesnt appear they have taken out any taxes (Im not clear why on it wasnt taxed).

Should we file jointly or separate? Im not sure if itemization will be worthwhile jointly, but it might be if we file separately? (ie, jointly we'd have to have more than ~9400 worth of deductions before we got any benefit, but separately one of us could claim the 4700 standard deduction while the other claimed the itemizations?) I probably made $46k last year and she probably made $15k. I may or may not have claimed her as a deduction out of my original pay.

I might just start messing around with tax software to see what works best but I thought Id make a post. People tout owning a house as a great tax shelter, but the first (standard deduction amount) of it doesnt give you any break , right? Hence having to itemize.


Also, Ive never itemized, what is a good place to find a list of things to note.

 

[EagleKeeper]

Whne married filing seperately, most must itemize or not; No mixing.

When itemizing, there are four main fields to cover.
State / Local taxes
Housing Interest/taxes/(closing costs/points)
Charitable Deductions
Employee Expenses


If you file seperately, you there may be limitations for the educational expenses.

Obtain tax S/W to make it easy to run some what-if scenarios.

 

[ironk]

A little confused about "federal Earned Income Credit (EIC)". I took their eligibility test and passed it. However, on TurboTax's website it says that you must have earned income in 2004. But the eligibility test asks no such question. Who is right? Do i need to have earned income in 2004 to be eligible for EIC?

TIA.

 

[EagleKeeper]

Originally posted by: ironk
A little confused about "federal Earned Income Credit (EIC)". I took their eligibility test and passed it. However, on TurboTax's website it says that you must have earned income in 2004. But the eligibility test asks no such question. Who is right? Do i need to have earned income in 2004 to be eligible for EIC?

TIA.

Documentation oversight by TurboTax.

 

[Ryan]

Man - I can't stand TurboTax - after asking me if I qualify for educatinal credits/deductions, I get some BS response about how the IRS has not updated their deduction information, and I can't continue my filing. I've got the latest updates too!

WTF.

 

[dxkj]

So basically if my property/state/local taxes + mortgage interest isnt > joint deductions then I get no tax benefit for owning a house.....?


doh

 

[EagleKeeper]

Originally posted by: dxkj
So basically if my property/state/local taxes + mortgage interest isnt > joint deductions then I get no benefit for owning a house.....?


doh

Correct Grasshopper -

No tax benefits

 

[ironk]

Documentation oversight by TurboTax.

Ah, i'll let them know. thx.

 

[dxkj]

Originally posted by: EagleKeeper

Originally posted by: dxkj
So basically if my property/state/local taxes + mortgage interest isnt > joint deductions then I get no benefit for owning a house.....?


doh

Correct Grasshopper -

No tax benefits

Thanks again for the quick responses.

 

[CPA]

Originally posted by: GuitarDaddy

Originally posted by: ironk
Are selling things on anandtech "For Sale" forums or a few things every now and then on ebay supposed to be reported as an income? I mean, i sell computer components i no longer need since i have upgraded to better equipment....sold about 5-6 items in 2005.

Thx.

No, is the short answer

GD is correct, but the IRS and Congress have been looking into how to make more of the sales on ebay taxable income.

for the most part, if you don't do it on a regular basis, then it is not taxable income.

 

[Bulldog13]

I lived with my parents until mid-June, got my own job, own place, etc all around the same time.

Can my parents claim me as a dependant ? Should they ? How does it work ? It is almost a dead even split of the year with me being on my own vs living with them.

Thoughts ?

 

[dxkj]

If they have been claiming you on their taxes all year, then i would let them, otherwise they take a big hit when filing without you.

 

[EagleKeeper]

Originally posted by: Bulldog13
I lived with my parents until mid-June, got my own job, own place, etc all around the same time.

Can my parents claim me as a dependant ? Should they ? How does it work ? It is almost a dead even split of the year with me being on my own vs living with them.

Thoughts ?

Get some tax S/W and run both scenarios - use what is determined best.

 

[Bulldog13]

Originally posted by: EagleKeeper

Originally posted by: Bulldog13
I lived with my parents until mid-June, got my own job, own place, etc all around the same time.

Can my parents claim me as a dependant ? Should they ? How does it work ? It is almost a dead even split of the year with me being on my own vs living with them.

Thoughts ?

Get some tax S/W and run both scenarios - use what is determined best.

Thanks !

 

[patrick409]

Hi, I have a question about claiming a lifetime learning credit for 2004.

My parents paid the tuition in 2004, but they couldn't claim me as a dependant since I graduated that year and started full time work.

I didn't claim the credit on my 2004 return, so I want to claim it now. What do I need to do?

1040X for 2004? Do I need to fill out form 8863 as well? Should I do it together or separately with my 2005 return?

Many thanks in advance!