6th Annual Anandtech Tax Time Thread

[Aimster]

School Tax:

on the 1098-T form they had 5 Scholarships or Grants $10,000. I just double checked two weeks later and this spot is blank.

Basically I got a $10,000 loan from SallieMae. I used $3,800 of my own money (credit card) to pay for my tuition. The school released me the $10,000.

Now if spot 5 has $10,000 in it then I do not get any kind of education tax credit. However it is left blank I can get a tax credit for the $3,800 I paid for tuition.

I am assuming it should be blank and it was in there as an error and they fixed it.

Can anyone assist? Thanks

 

[UDT89]

can anyone recommend a law enforcement tax site? one that lays out all the possible deductions? its my first time having a full year and I dont want to miss anything

 

[jinduy]

i live in my mom's house. if i give her $400 a month, does that count as me paying rent officially?

 

[EagleKeeper]

Originally posted by: jinduy
i live in my mom's house. if i give her $400 a month, does that count as me paying rent officially?

If the two of you want to calssify the amount as rent.

She then has to declare the rent as income.
She also will have the option of then fileing with a Schedule E showing retnal income and expenses to offset that income.

 

[EagleKeeper]

Originally posted by: UDT89
can anyone recommend a law enforcement tax site? one that lays out all the possible deductions? its my first time having a full year and I dont want to miss anything

I am not sure what you are looking for.
If you have expenses that are related to work, look at the IRS guidelines for the Form 2106.

Materials that is inappropriate for civilian use needed to do your job can be expensed.
Clothing that is inappropriate for civilian use needed for your job can be expensed.
Education that maintains/enhances your postiion can be expensed.

The IRS is not going to bless any site for accuracy; so if yo find one, you will have to take your chances.

 

[EagleKeeper]

Originally posted by: Aimster
School Tax:

on the 1098-T form they had 5 Scholarships or Grants $10,000. I just double checked two weeks later and this spot is blank.

Basically I got a $10,000 loan from SallieMae. I used $3,800 of my own money (credit card) to pay for my tuition. The school released me the $10,000.

Now if spot 5 has $10,000 in it then I do not get any kind of education tax credit. However it is left blank I can get a tax credit for the $3,800 I paid for tuition.

I am assuming it should be blank and it was in there as an error and they fixed it.

Can anyone assist? Thanks

If you get conflicting statements without an explanation for the second, contact the provider and get clarification

 

[EagleKeeper]

Originally posted by: Praetor
Quick question, I'm over at my mom's house trying to do her taxes for the first time, she's always taken them to H&R Block previously.

In past years, she's been able to claim my 27 y/o sister as a dependent because she wasn't able to work and my mom supported her 100%.

Last year, she started to work and made just over $1,000. TurboTax seems to think that she can claim my sister again this year. But where do I put in my sister's W-2? Do I enter it on my mom's tax return or do I file a separate one just for my sister?

Sister's income goes on the sister's return. Sister should file as a dependant.

 

[EagleKeeper]

Originally posted by: hx009
I'm not sure if it was answered (this thread is really long) but for the first time I find myself owing (~$1000). I don't have a retirement account of any kind at this time.. so my question is: Can I open a IRA (Roth or standard) right now (Feb '09) and dump the max into it from my savings and count it against 2008? Will it bring down my income enough to at least have me not owe? I know that depends on other variables, but just in the general sense does a retirement account max contribution impact the bottom line enough to bother I guess?

A Standard IRA will help as long as you do not have a qualified retirement plan with an employer

 

[EagleKeeper]

Originally posted by: Turin39789
After tuition reimbursement and scholarships, my wife and I both have about ~$1700 of tuition to deduct.

We both have almost identical income. We got married in the fall, no dependents, renters, planning on taking the standard deduction.

Is there any reason that we should consider married filing separate? I ran one tax program as joint, and then switched it to separate at the end and it came out with a larger deduction on state, but I can't duplicate the results on a different software package. I'm thinking the first one made a mistake, because if we file fed as married joint my new understanding is that we can't deduct tuition at all, anywhere.

Married filing seperately is best when there are two highly different incomes and deductions that can be pushed to one person.

As you noticied, there are also some penalties in certain credits are disallowed.

The tuition can be deducted if you itemize; but both will have to.

 

[CPA]

Originally posted by: JDub02

Originally posted by: CPA

Originally posted by: JDub02

Originally posted by: hx009
I'm not sure if it was answered (this thread is really long) but for the first time I find myself owing (~$1000). I don't have a retirement account of any kind at this time.. so my question is: Can I open a IRA (Roth or standard) right now (Feb '09) and dump the max into it from my savings and count it against 2008? Will it bring down my income enough to at least have me not owe? I know that depends on other variables, but just in the general sense does a retirement account max contribution impact the bottom line enough to bother I guess?

From the intarwebs, looks like you have until 4/15/2009 or until you file your return to open and contribute to an IRA and still claim it on your 2008 return.

Can a professional confirm this?

What are the contribution limits for myself or my wife and how would they affect my return? I tried plugging numbers into TaxCut and it looks like $1500/each is not showing up with any "non-qualifying" contributions. I started with 2500 for myself and wound up with a chunk that it wouldn't let me write off.

You are correct. The reduction of income however will only have the effect of your effective tax rate. So, if your effective tax rate is 25%, you will only save $250 of tax if you deposited $1000.

Depending on your income you can contribute up to $5K for 2008.

According to TurboTax and TaxCut, my wife and I can only contribute $1550 each tax-deferred since we were both covered under a retirement plan at work. Still, since we're in the 25% bracket, that's basically an instant 25% return since we'd have to shell out that money to Uncle Sam. Looks like I'll be calling someone tomorrow to open up an IRA with $3100.

Sounds good. I failed to mention that after the ceiling there is a reduced limit based on your income level above the ceiling. Looks like you guys are slightly above the ceiling but below the cap.

 

[ElFenix]

can i pay my taxes owed via direct withdrawal from my savings account? i think i can

 

[Aikouka]

I have a question regarding stocks (and taxes) that's been bothering me for a bit. I received some IBM shares when my grandmother died and decided to pull them out of the market rather than worry about them (and based on the prices over the last six months, I chose a good time).

But now here comes the fun part... tax time. The company sent me a 1099B and that simply listed the total amount received (i.e. shares * sell price) and I had a lot of trouble even finding out what to do with this information on the 1040. I eventually just threw it in somewhere up top as a temporary measure and continued on with the form.

I spoke with my mom about it, and she said that she talked to a local tax preparer about it. He said we just needed to claim the dividends (i.e. number of shares * (sell_price - price_at_death)). But the thing is, I never received a 1099-DIV from the company that held the shares.

Can anyone help shed some light on this subject?

 

[CPA]

Originally posted by: Aikouka
I have a question regarding stocks (and taxes) that's been bothering me for a bit. I received some IBM shares when my grandmother died and decided to pull them out of the market rather than worry about them (and based on the prices over the last six months, I chose a good time).

But now here comes the fun part... tax time. The company sent me a 1099B and that simply listed the total amount received (i.e. shares * sell price) and I had a lot of trouble even finding out what to do with this information on the 1040. I eventually just threw it in somewhere up top as a temporary measure and continued on with the form.

I spoke with my mom about it, and she said that she talked to a local tax preparer about it. He said we just needed to claim the dividends (i.e. number of shares * (sell_price - price_at_death)). But the thing is, I never received a 1099-DIV from the company that held the shares.

Can anyone help shed some light on this subject?

You didn't receive dividends, so it shouldn't be reported as dividends. It needs to be reported as a gain/loss on Schedule D.

Now, since this was an inheritance you would value the stock on a step-up basis, meaning you value the stock at the price on date of death. Your grandmother's estate tax return should disclose that information. If it doesn't, you can easily find the value of the stock on her date of deat online.

also, even though it sounds like you held this stock less than 2 years, you can claim is as a long-term gain, which puts you in the 15% tax bracket rather than ordinary income tax bracket. Remember this because Schedule D has a section for long-term gains/losses and short-term gains/losses. Put the sale in the long-term section.

One last note, in the column asking for "acquisition date", put in inherited instead. This gives you the clearance to report as long-term.

 

[CPA]

Originally posted by: ElFenix
can i pay my taxes owed via direct withdrawal from my savings account? i think i can

I don't see why not, if you are electronically filing.

I always send in a check, so I get the float.

 

[50]

Hello,

I started working an 8 month internship in NJ, but I am a MA resident. Can I get the state income tax NJ charges me back? Thanks

 

[BlahBlahYouToo]

2 questions and TIA.

1. work in CT, live in NJ - not sure if they have reciprocity. does anyone know off hand? how do i find out?
i'm assuming no. they are non-neighboring states.

2. does turbo tax handle a situation like this? my gf says no (she's done taxes before, i haven't so i really know nothing of the like). she mentioned something about needing another version/copy of turbo tax to do 2 state returns.

Text

ok, found out they do not have reciprocity. so question 1 answered, question 2 still holds. do i need 2 copies of turbo tax in this instance?

 

[EagleKeeper]

Originally posted by: 50
Hello,

I started working an 8 month internship in NJ, but I am a MA resident. Can I get the state income tax NJ charges me back? Thanks

You will have to see how MA handles out of state income.

State Tax S/W does not like people that have income from multiple states. They are designed to handle income from only one state and will not transfer tax data between state returns (used to not - read the instructions carefully and/or ask before purchase the state version).
Places like H&R Block wil charge you $50-100+ per state to handle this type of issue.

Or do your Federal and then follow the instructions for the state on paper.
Most states will not allow you to file out-of-state residence electronically.

 

[EagleKeeper]

Originally posted by: BlahBlahYouToo
2 questions and TIA.

1. work in CT, live in NJ - not sure if they have reciprocity. does anyone know off hand? how do i find out?
i'm assuming no. they are non-neighboring states.

2. does turbo tax handle a situation like this? my gf says no (she's done taxes before, i haven't so i really know nothing of the like). she mentioned something about needing another version/copy of turbo tax to do 2 state returns.

Text

ok, found out they do not have reciprocity. so question 1 answered, question 2 still holds. do i need 2 copies of turbo tax in this instance?

See Answer above.
State Tax S/W for Conn could be downloaded on your system and for NJ on your GF system to determine what the guidelines are.

 

[pkananen]

If my 1099-MISC has 0.00 for every line item....do I need to report it?

 

[compguy786]

Hello Guys,

I have a couple of questions regarding to filing taxes. This is my first time i am filing, and i am using TurboTax.

I made $5,750 last year, i am a FT student, and PT worker. I am also claimed
as a dependent on another return (dad) I also did supported more than half of myself as well.

Question is, I am getting $358 from the feds and $50 from the state back in refunds.
i paid over $1k in taxes, $233 alone to the state. does $408 seem kinda low ?

My dad said i shouldn't have to pay taxes, since he does already, but i just
want assurance what i am doing is right, and that i am not losing any more $$ in the process !

Thanks !

 

[EagleKeeper]

Originally posted by: pkananen
If my 1099-MISC has 0.00 for every line item....do I need to report it?

You have a flawed 1099

Technically,you do not need to report the income. However, there is a good chance that the 1099 will get fixed and you will then have to file a 1040X. More paperwork that way.

 

[EagleKeeper]

Originally posted by: compguy786
Hello Guys,

I have a couple of questions regarding to filing taxes. This is my first time i am filing, and i am using TurboTax.

I made $5,750 last year, i am a FT student, and PT worker. I am also claimed
as a dependent on another return (dad) I also did supported more than half of myself as well.

Question is, I am getting $358 from the feds and $50 from the state back in refunds.
i paid over $1k in taxes, $233 alone to the state. does $408 seem kinda low ?

My dad said i shouldn't have to pay taxes, since he does already, but i just
want assurance what i am doing is right, and that i am not losing any more $$ in the process !

Thanks !

Becuase you are being claimed as a dependant, your min income level is lowered. Therefore you pay more taxes.

You do not get any benefits for student tuition either.

 

[ElFenix]

Originally posted by: CPA

I don't see why not, if you are electronically filing.

I always send in a check, so I get the float.

i don't have checks

 

[SirChadwick]

Here's my question. I'm currently e-filing and want to take advantage of the $7500 tax credit for first-time home buyers.

We purchased our home on August 4, 2008.

Now as of right now I can go ahead and get the tax credit, but it's repayable over 15 years (which is fine...)

But I keep reading these articles about newly proposed House/Senate tax credits mentioning $15,000 etc.

And there is talk about it not having to be repaid with these new proposals.

Should I hold off on filing my taxes until more info comes out? I don't want to throw away $7500 if changes are made to the plan. Or will it impact me at all? Anyone have more info on this?

 

[BlahBlahYouToo]

i've decided my taxes are too complicated to do (2 states, investment accounts, 2 properties, etc.).
what's the average cost for a competent tax accountant, not HR block plz.