5th Annual Tax Thread - 2007

[polarmystery]

great I didn't know that

Question 2: I am not sure what I'll finally owe but...I did pay a lot of interest on student loans this past year. I only got the 900 figure because turbotax online had a estimated amount. I didn't submit my taxes because I wanted to see what all I might owe. It never asked me for those and I know that they are deductable. Where on my taxes do I claim those deductions?

I am a completel n00b to taxes

 

[EagleKeeper]

Originally posted by: intogamer
I have a question and I'm a minor

I got my W-2 in the mail for my job in summer '07. I got taxed $20.19 for Federal $55.80 Social Security and $13.05 for Medicare from $900. I would like to open up a Roth IRA, is it still possible right now? Do I contribute $900 or after taxed amount?

You can still open a ROTH through 15 April.

IRS FAQ

Roth IRAs only. If contributions are made only to Roth IRAs, your contribution limit generally is the lesser of:
? $4,000 ($5,000 if you are age 50 or older), or
? Your taxable compensation.

 

[waffleironhead]

Originally posted by: boardsportsrule
New question here

I worked in winter, spring and summer of 2007 in oregon(made about 4k).

In fall 2007 i moved to California to do go to college.

I got a job in fall 2007(in cali) (made about 1k).

I want to claim "residency" in california to get instate tuition.

Thus i am confused on what tax forms to fill out.

I was a resident in oregon when i made my income there, and i was a resident in california when i made my income there.


So which state do i do an "instate tax return" and which do i do an "out of state from"?


Thanks

Andy

I am by on means a tax person or anything, but having moved from state to state quite a bit, both states should have a part year resident tax form, you will most likely have to file both. Californias is 540nr if memory serves.

 

[cpals]

Bank interest question...

My bank always seem to lag a lot in getting me my interest statement. If the interest is below $30 or so... very minimal do I need to wait for the 1099-INT to file or is it looked upon as such a measly amount it doesn't matter?

Thanks.

 

[thereds]

Odd situation here.

Last tax year I was due a refund of about a $1,000. This year, however, after using a few online calculators, I find out that I owe about $900. What gives? My income only went up by 3% annually and I haven't changed anything on my W4. Everything has remained the same, so trying to figure out why the swing...

edit - both the last and this current year, my tax bracket has been the same.

 

[Qacer]

So far so good, thanks EagleKeeper!

I have a few questions regarding 1099-B.

1). Do I count the dividends re-invested into the stock as part of my cost basis?
2). I bought the same stock at multiple periods. Some of these periods were less than one year and others were bought more than a year before I sold all the shares of the said stock. How do I handle this?


I also have some questions regarding higher education expenses.

1). I took some student loans last year for Spring and Summer 2007. I am not due to start paying the loans until March 2008. The student loans covered 100% of my tuition including books. Do I qualify for any deductions for this situation?

2). In 2006, my tax preparer told me that I could deduct the cost of mileage from home to school. Is this still applicable for 2007?


Thanks!

 

[EagleKeeper]

Originally posted by: cpals
Bank interest question...

My bank always seem to lag a lot in getting me my interest statement. If the interest is below $30 or so... very minimal do I need to wait for the 1099-INT to file or is it looked upon as such a measly amount it doesn't matter?

Thanks.

You should be able to look at your statement to see what the total interest has been.

If the interest is below $1 it does not matter.
Above that, Uncle wants his share and is very demanding about it.

 

[EagleKeeper]

Originally posted by: thereds
Odd situation here.

Last tax year I was due a refund of about a $1,000. This year, however, after using a few online calculators, I find out that I owe about $900. What gives? My income only went up by 3% annually and I haven't changed anything on my W4. Everything has remained the same, so trying to figure out why the swing...

edit - both the last and this current year, my tax bracket has been the same.

Until you actually do the numbers and then look at the final results side by side, you never know.

There are credits that may factor into the equation that the calculators do not catch.

 

[EagleKeeper]

Originally posted by: Qacer
So far so good, thanks EagleKeeper!

I have a few questions regarding 1099-B.

1). Do I count the dividends re-invested into the stock as part of my cost basis?
2). I bought the same stock at multiple periods. Some of these periods were less than one year and others were bought more than a year before I sold all the shares of the said stock. How do I handle this?


I also have some questions regarding higher education expenses.

1). I took some student loans last year for Spring and Summer 2007. I am not due to start paying the loans until March 2008. The student loans covered 100% of my tuition including books. Do I qualify for any deductions for this situation?

2). In 2006, my tax preparer told me that I could deduct the cost of mileage from home to school. Is this still applicable for 2007?


Thanks!

1) The dividends are taxable.
They also add to the cost basis.

2) You need to determine the value of the stock each time you purchased it and determine that when you sell it, d those shares get classified as long or short term gains? Purchase by purchase and sale by sale.

3) Loans have no impact on qualification for the educational credits.
The educational credits only apply to that actual tuition costs. Books can not be used against the credits.

4) Mileage to school is only valid IF
a) You itemize using the Schedule A and Form 2106
b) You are working and going to school to improve yourself within the line of work.

 

[thereds]

Originally posted by: EagleKeeper

Originally posted by: thereds
Odd situation here.

Last tax year I was due a refund of about a $1,000. This year, however, after using a few online calculators, I find out that I owe about $900. What gives? My income only went up by 3% annually and I haven't changed anything on my W4. Everything has remained the same, so trying to figure out why the swing...

edit - both the last and this current year, my tax bracket has been the same.

Until you actually do the nubmers and then look at the final results side by side, you never know.

There are credits that may factor into the equation that the calculators do not catch.

Thanks!

But last year I used the same calculator and got the exact refund the calc said I'd get when I finally did my taxes.

 

[EagleKeeper]

Things change year to year.

Do the numbers and then look at the result for each calculation side by side and see where the issues are.

 

[Qacer]

I didn't do the detail view on my tuition and fees earlier. Now that I did, I remember that I took a portion of my loan for school related expenses. Basically, for my student loans, I got approved for a certain amount. My school tuition was less than the approved amount, so I requested a portion of my approved amount in the form of a check for other school related expenses.

Do I include the check amount for my tuition & fees calculation?

Thanks!

 

[EagleKeeper]

Originally posted by: Qacer
I didn't do the detail view on my tuition and fees earlier. Now that I did, I remember that I took a portion of my loan for school related expenses. Basically, for my student loans, I got approved for a certain amount. My school tuition was less than the approved amount, so I requested a portion of my approved amount in the form of a check for other school related expenses.

Do I include the check amount for my tuition & fees calculation?

Thanks!

Loan amounts have no impact on the educational credits as applys to the tuition.

 

[Al Neri]

On TurboTax it says to qualify for LifeLong Learning Credit (NOT HOPE) I need to have an income below 57,000 (or 52,000). When I look at the 2007 IRS bulletin it says 78,000. Is this an error on TurboTax? Additionally, can I deduct the tuition AND also claim the lifelong learning credit? if not which is usually superior?

Thanks,

Don

 

[EagleKeeper]

Originally posted by: Don Rodriguez
On TurboTax it says to qualify for LifeLong Learning Credit (NOT HOPE) I need to have an income below 57,000 (or 52,000). When I look at the 2007 IRS bulletin it says 78,000. Is this an error on TurboTax? Additionally, can I deduct the tuition AND also claim the lifelong learning credit? if not which is usually superior?

Thanks,

Don

Usually the tuition is better - however, the rules to use it are tighter.

As to the number differences - contact TT CSR and ask them.

 

[Al Neri]

Originally posted by: EagleKeeper

Originally posted by: Don Rodriguez
On TurboTax it says to qualify for LifeLong Learning Credit (NOT HOPE) I need to have an income below 57,000 (or 52,000). When I look at the 2007 IRS bulletin it says 78,000. Is this an error on TurboTax? Additionally, can I deduct the tuition AND also claim the lifelong learning credit?

Thanks,

Don

Usually the tuition is better - however, the rules to use it are tighter.

As to the number differences - contact TT CSR and ask them.

Additionally, can I deduct the tuition AND also claim the lifelong learning credit? if not which is usually superior?

 

[EagleKeeper]

Originally posted by: Don Rodriguez

Originally posted by: EagleKeeper

Originally posted by: Don Rodriguez
On TurboTax it says to qualify for LifeLong Learning Credit (NOT HOPE) I need to have an income below 57,000 (or 52,000). When I look at the 2007 IRS bulletin it says 78,000. Is this an error on TurboTax? Additionally, can I deduct the tuition AND also claim the lifelong learning credit?

Thanks,

Don

Usually the tuition is better - however, the rules to use it are tighter.

As to the number differences - contact TT CSR and ask them.

Additionally, can I deduct the tuition AND also claim the lifelong learning credit? if not which is usually superior?

You can only claim one.

Tax S/W will assist you in deterining which will be best.

If you do not use Tax S/W, I can only advise you to crunch the numbers by hand according to the rules and see what happens.

 

[zhwu]

I have been enrolled in an employee stock purchase plan (buying them with a 15% discount) for more than 4 years. I sold all my stock in 2007 after I left the company. Since I purchased these stocks 4 times a year, there are more than 16 different purchase prices for these stocks and just one single sale. Do I have to list all these transactions one by one on the tax paper or can I just combine all these purchases into one overall purchase price? Also, does long-term & short-term concept applies to ESPP sale? (If so, I assume part of that sale would be long term gain and part of it would be short term gain?)


Thanks.

 

[EagleKeeper]

Originally posted by: zhwu
I have been enrolled in an employee stock purchase plan (buying them with a 15% discount) for more than 4 years. I sold all my stock in 2007 after I left the company. Since I purchased these stocks 4 times a year, there are more than 16 different purchase prices for these stocks and just one single sale. Do I have to list all these transactions one by one on the tax paper or can I just combine all these purchases into one overall purchase price? Also, does long-term & short-term concept applies to ESPP sale? (If so, I assume part of that sale would be long term gain and part of it would be short term gain?)


Thanks.

Each one should be listed on the Schedule D and for each, the short term/long term gain is calculate

 

[cpals]

Originally posted by: EagleKeeper

Originally posted by: cpals
Bank interest question...

My bank always seem to lag a lot in getting me my interest statement. If the interest is below $30 or so... very minimal do I need to wait for the 1099-INT to file or is it looked upon as such a measly amount it doesn't matter?

Thanks.

You should be able to look at your statement to see what the total interest has been.

If the interest is below $1 it does not matter.
Above that, Uncle wants his share and is very demanding about it.

I just went online to look this up and the bank website says if the account made less than $20 in interest they do not send a 1099-INT... does that mean they aren't sending it to the IRS? I think I made like $10

 

[Soundmanred]

My daughter is 15 months old.
She lives with me 50% of the time, and with her mother 50% of the time.
She makes about $10k per year, I make almost $20k.
She filed her taxes (unbeknownst to me) last week and claimed our daughter.
I didn't know she filed, and when filing (A few days ago) was informed that the parent with the higer AGI should claim the child, so I claimed her.
She told me tonight that she already had her taxes done and claimed her.
Any idea what will happen?

 

[AlienCraft]

Did minein less than2 hours with TT.
Had to import last years data over to the new desktop machine, but that was about the hardest part.
Oh, and loading the paper for two copies of Federal and State.... some 110 pages.....

 

[Qacer]

I'm trying to understand the education deduction portion of a tax return.

Here is a scenario:

John Doe receives a 1098-T form from school. The only section (box) that has a monetary value attached to it is "Box 2 - Amounts billed for qualified tuition...". Let's say it is showing $1600. All his education fees including books were paid using student loans. He also took out some money from his student loans for living expenses. On top of that, he had a full time job, but didn't do tuition reimbursement. Let's say he was pursuing his Master's degree.

On his school account charges for 2007, it is showing the following:

Spring 2007
Description - Charges
Books - $200
Check for living expenses - $1500
Other school fees - $200
Tuition - $150
Tuition - $600
Tuition - $600
Tuition - $100
Total charges - $3350

Summer 2007
Description - Charges
Books - $150
Check for living expenses - $500
Other school fees - $200
Tuition - $600
Tuition - $600
Tuition - $100
Total charges - $2150

All charges were paid using student loans. Based on these numbers, what would be the qualifying tuition & fees amount that can be used for his education deduction calculations?

Thanks again!

 

[EagleKeeper]

Originally posted by: cpals

Originally posted by: EagleKeeper

Originally posted by: cpals
Bank interest question...

My bank always seem to lag a lot in getting me my interest statement. If the interest is below $30 or so... very minimal do I need to wait for the 1099-INT to file or is it looked upon as such a measly amount it doesn't matter?

Thanks.

You should be able to look at your statement to see what the total interest has been.

If the interest is below $1 it does not matter.
Above that, Uncle wants his share and is very demanding about it.

I just went online to look this up and the bank website says if the account made less than $20 in interest they do not send a 1099-INT... does that mean they aren't sending it to the IRS? I think I made like $10

The bank may not send it to you - but it will get reported to Uncle.

 

[EagleKeeper]

Originally posted by: Soundmanred
My daughter is 15 months old.
She lives with me 50% of the time, and with her mother 50% of the time.
She makes about $10k per year, I make almost $20k.
She filed her taxes (unbeknownst to me) last week and claimed our daughter.
I didn't know she filed, and when filing (A few days ago) was informed that the parent with the higer AGI should claim the child, so I claimed her.
She told me tonight that she already had her taxes done and claimed her.
Any idea what will happen?

1) Either Uncle will reject your taxes because the child has already been claimed.

2) Uncle will send a letter to both of you stating the the child has double dipped and to get you act together. Instructions on how to resolve the issue will be within the notification letter.

Many times, custody disputes will use the child as a pawn when it comes to taxes. First come first served in Uncle's eyes - he expects the parents to be mature about this situation.