7th Annual Anandtech Tax Time Thread

[zhwu]

I have a question about buying Roth IRA after filing the tax.

I filed my tax in Feb in order to get tax fund earlier. My wife just got a job offer and I started thinking about buying some Roth IRA for tax year 2009 with our emergency funds before Apr 15 deadline.

I did my taxes with software and not familiar with all the forms. Do I need to file
any addendum(s) because of this? I don't think this will impact the final number but I have never done any tax addendum before and not sure how much hassle it will cause (will that increase my chances getting audited?) Anyway, just trying to figure out if it will worth my effort to buy Roth IRA for tax year 2009 at this point.

 

[EagleKeeper]

I have a question about buying Roth IRA after filing the tax.

I filed my tax in Feb in order to get tax fund earlier. My wife just got a job offer and I started thinking about buying some Roth IRA for tax year 2009 with our emergency funds before Apr 15 deadline.

I did my taxes with software and not familiar with all the forms. Do I need to file
any addendum(s) because of this? I don't think this will impact the final number but I have never done any tax addendum before and not sure how much hassle it will cause (will that increase my chances getting audited?) Anyway, just trying to figure out if it will worth my effort to buy Roth IRA for tax year 2009 at this point.

Roths do not require any paperwork by you when funding them. The Trustee takes care of all of it.

Therefore, you do not have to modify your previously filed return

 

[Sheepathon]

thanks!

 

[IHAVEAQUESTION]

One question about the IRA and 401k. Say if the company and I have contributed money into 401k, how much IRA can I fund, and whether there is a tax limit to it.

Another question is that I haven't received a W2 from my previous employer despite numerous requests, what do I need to do if I don't receive one before april 15th? Can I still file tax?

 

[EagleKeeper]

One question about the IRA and 401k. Say if the company and I have contributed money into 401k, how much IRA can I fund, and whether there is a tax limit to it.

Another question is that I haven't received a W2 from my previous employer despite numerous requests, what do I need to do if I don't receive one before april 15th? Can I still file tax?

Try to get the employer to fax a copy of your W2 if they will communicate.

If the employer is unwilling to communicate with you; then you should file a return on paper with the information you have and also include a statement to the IRS indicating that the previous employer (identify then by name/address) refuses to provides you with a W2.



Once the IRS gets involved, you should get a W2 (one way or another). You will then have to file an ammended return 1040X with the new information.

IRA limits are based on multiple factors
Please see the IRA guidelines 2009 IRA Contribution and Deduction Limits

 

[IHAVEAQUESTION]

Thanks, eaglekeeper!

 

[bruceb]

One word of advice as to the above:

If you are doing your own taxes with TurboTax and have a Pay Stub with the Employer ID Number, TurboTax can (sometimes) download the W-2 for you right into the program.

 

[IHAVEAQUESTION]

thanks. I will look into it.

Btw, i read the article eaglekeepper gave to me, I am still unsure about how the 401k can affect the IRA. Say the company and I each contributed $1000 to the 401k, can I still fund $5000 to the IRA?

 

[scootermaster]

I'll try and be as detailed as possible. Thanks already for reading!

I'm in a Ph.D. program (past 4 years, if that matters).

Fun facts:
- I get a W-2 and salary from the university as a teaching assistant.
- They charge me tuition, and then when I sign my TA letter, credit my account
- They do the same for my [mandatory] health insurance, as well as a "health center fee"
- There's about $130 in fees (per semester) that are not covered from my TA award (I pay these myself)

Now, the fun part: I entered in info from a 1098-T in to TaxAct, thinking it'd help me get a bigger return, and it in fact cuts in by 75%. I only have info in boxes 2 (amounts billed for qualified tuition and related expenses) and box 5 (scholarships and grants).

As best as I can tell, the amount in box 2 is the aforementioned fees that I pay out of pocket. Box 5 is the aggregate of my health insurance-related fees. In the transactions, these are listed (for example, "Box 5: Fall 09 GA health Fee award", listed with a negative value). Also listed (before everything else) are things like "Fall 09 other non-qualified charge". These "non-qualified" charges match up with the "negative" debits that listed as Box 5 items.

So, it seems to me, I'm paying taxes on "awards" that I got. But I'm not allowed to (or don't know how to) deduct (or reduce my tax liability) for the expenses I've incurred (even though I didn't pay for tuition or health insurance out of pocket, they charge and then credit my account, so in a sense I do pay for it).

Questions:
1. Is this just the way it is?
2. Is there a way of entering in the amount the university paid for me for tuition (again, which I get as part of my TA award) to lower my tax liability/increase my return?
3. Is it possible the 1098-T is entered in incorrecty, seeing as there's nothing in box 1?
4. Is there anything in general I can do about this? Like I said, my return is 3 times as big without this 1098-T information. Can I just not file the 1098 or not choose any of those educational programs? Or is that lying/bad?

Thank you SO much to anyone who can help. I searched a bit for 1098 and didn't see anything that was exactly applicable. If it was answered already, I'll search harder.

 

[EagleKeeper]

thanks. I will look into it.

Btw, i read the article eaglekeepper gave to me, I am still unsure about how the 401k can affect the IRA. Say the company and I each contributed $1000 to the 401k, can I still fund $5000 to the IRA?

Without knowing the details of your employment retirement situation and personal life; it is difficult to provide you with an answer.

The IRS links provide you with the limits given the different scenarios.

All of the main three Tax S/W packages (online/offline) can try (for a fee) to obtain your W2 from the payroll provided if they participate in the program.

 

[endervalentine]

I have 2 questions, hope some of the tax gurus in here can help me out. Thanks in adv!

I received a 1099-B form from a company that got acquired. I'm not sure how to enter this in HR Block software, the 1099-B form does have the Box1a, Box2, etc but when I'm on the 1099-B screen in HR Block, it just asks me to put in my capital gains, etc.


Traditional IRA and Roth IRA income limits and contribution limits:
Are there any income limits for Traditional IRAs? I thought I had read somewhere where if you are above the income limit for a Roth IRA, you can start a traditional IRA (which does not have any income limit), contribute the $5k, then convert that into a Roth IRA.

I can't find the link any more ... did I remember/read that incorrectly or is this true?

 

[EKKC]

Hi guys, I have multiple questions that I hope I can get answered because I don't think my accountant is giving me all the correct answers,

Background info:
Me and my gf now own a coop apt in nyc (since nov 2004), we are in the process of closing on the sale of a new home as primary residence (retaining the current coop for now). We are at the closing stages (mortgage approved, commitment pending, etc) but not closed yet. Obviously we have to do our taxes now, do we submit the First-Time Homebuyer Credit form 5405 now or wait for tax year 2010? Both our names are on the current and new residence (both deed and mortgage). Must we split the credit 50-50? Can we do 0-100?

1) Are we eligible for $6500 or $8000 credit? We have been in same coop apt for over 5 years, since Nov 2004. Closing the sale of new home this or next month.

2) Can we allocate 0%-100% on the credit instead of 50-50? I'm worried my income is too high to be eligible. (the limit is 125k, I have 1099-based income in addition to my W2 that may put me over that range, but she is safe within the limit) Also of note is we are not married and are filing separately.

3) Do we have to file for the credit and submit the form 5405 now with our (or just her) tax returns? Or is this an amendment (1040x) later down the road? This is the most confusing part. We do not have the closing statement (HUD1) - only the binding contract right now.

 

[EagleKeeper]

I have 2 questions, hope some of the tax gurus in here can help me out. Thanks in adv!

I received a 1099-B form from a company that got acquired. I'm not sure how to enter this in HR Block software, the 1099-B form does have the Box1a, Box2, etc but when I'm on the 1099-B screen in HR Block, it just asks me to put in my capital gains, etc.


Traditional IRA and Roth IRA income limits and contribution limits:
Are there any income limits for Traditional IRAs? I thought I had read somewhere where if you are above the income limit for a Roth IRA, you can start a traditional IRA (which does not have any income limit), contribute the $5k, then convert that into a Roth IRA.

I can't find the link any more ... did I remember/read that incorrectly or is this true?

I will have to research the 1099-B

The other question may be referenced a few posts above (#555).

 

[EagleKeeper]

Hi guys, I have multiple questions that I hope I can get answered because I don't think my accountant is giving me all the correct answers,

Background info:
Me and my gf now own a coop apt in nyc (since nov 2004), we are in the process of closing on the sale of a new home as primary residence (retaining the current coop for now). We are at the closing stages (mortgage approved, commitment pending, etc) but not closed yet. Obviously we have to do our taxes now, do we submit the First-Time Homebuyer Credit form 5405 now or wait for tax year 2010? Both our names are on the current and new residence (both deed and mortgage). Must we split the credit 50-50? Can we do 0-100?

1) Are we eligible for $6500 or $8000 credit? We have been in same coop apt for over 5 years, since Nov 2004. Closing the sale of new home this or next month.

2) Can we allocate 0%-100% on the credit instead of 50-50? I'm worried my income is too high to be eligible. (the limit is 125k, I have 1099-based income in addition to my W2 that may put me over that range, but she is safe within the limit) Also of note is we are not married and are filing separately.

3) Do we have to file for the credit and submit the form 5405 now with our (or just her) tax returns? Or is this an amendment (1040x) later down the road? This is the most confusing part. We do not have the closing statement (HUD1) - only the binding contract right now.

You will have to file the home ownership for 2010.

1) As long as you are under contract by 30 April and close by 30 June; your purchase is eligible.

2) The total credit is $6500 - how you allocate it is up to you.

3) The 5405 is submitted with a copy of the closing statement when you file the 2010 tax return. I have heard of no provision for applying the credit for a purchase in 2010 being able to be applied in 2009.

NOTE: The credit available is based on your filing status at the end of 2010 - not when you purchase the place. So if you tie the knot in 2010 - you will have to apply the joint income limits for the eligibility of the credit

 

[scootermaster]

You do not need to file using the college paperwork if it will not help you.

If your income is over 90K, yet there are no taxes paid; something may be entered improperly unless you have high losses on investments or most of the income is tax exempt. Double check your entries to see what is causing TT to think that you have a different income than you believe

Even if the funds would be of benefit, there is no foul in filing with the accurate information you have on hand and then file a 1040X to account for the 1098T

Just to be clear, you don't have to file with any information given in a 1098-T if you don't want to? I posted above, but this is the key issue; applying for an educational credit (i.e. filing the info on the 1098-T) substantially decreases my return, and I want to know if I can just not do that.

 

[EKKC]

You will have to file the home ownership for 2010.

1) As long as you are under contract by 30 April and close by 30 June; your purchase is eligible.

2) The total credit is $6500 - how you allocate it is up to you.

3) The 5405 is submitted with a copy of the closing statement when you file the 2010 tax return. I have heard of no provision for applying the credit for a purchase in 2010 being able to be applied in 2009.

NOTE: The credit available is based on your filing status at the end of 2010 - not when you purchase the place. So if you tie the knot in 2010 - you will have to apply the joint income limits for the eligibility of the credit

man, thanks for clearing it up

in other words, I (or the gf/fiance whatever, as long as I don't get married this year) shouldn't even file a 1040x for 2009, correct? the 5405 should only be filed with 2010 tax return.

i guess my confusion was that the credit must be claimed this year, with tax form 2009, even if the purchase is/will be in year 2010.

thank you so much for your help!

 

[EagleKeeper]

You do not need to file using the college paperwork if it will not help you.

If your income is over 90K, yet there are no taxes paid; something may be entered improperly unless you have high losses on investments or most of the income is tax exempt. Double check your entries to see what is causing TT to think that you have a different income than you believe

Even if the funds would be of benefit, there is no foul in filing with the accurate information you have on hand and then file a 1040X to account for the 1098T

Just to be clear, you don't have to file with any information given in a 1098-T if you don't want to? I posted above, but this is the key issue; applying for an educational credit (i.e. filing the info on the 1098-T) substantially decreases my return, and I want to know if I can just not do that.

You do not have to file for the educational credit.

You DO have to declare the scholarship(s) as income.

The scholarships are what is increasing your income; increasing the tax owed and therefore reducing the refund amount.

Using the 1098_T identifies tuition/expenses that compensates for some of the "extra" income.

 

[EagleKeeper]

man, thanks for clearing it up

in other words, I (or the gf/fiance whatever, as long as I don't get married this year) shouldn't even file a 1040x for 2009, correct? the 5405 should only be filed with 2010 tax return.

i guess my confusion was that the credit must be claimed this year, with tax form 2009, even if the purchase is/will be in year 2010.

thank you so much for your help!

Uncle will have the proper instructions for people for those purchases when time comes for filing the 2010 forms

 

[dquan97]

Questions:
1. With W-2 and 1099 income for the same line of work, can I allocate 100% of the cost of licenses, medical premiums, malpractice insurance to offset the 1099 income?

2. Is there any additional way to deduct $17k in student loan interest aside from line 33 of the 1040? Line 33 only allows $2,500 max.

3. Books/tools purchased and used during med school (2002-2006) are now used in the line of work. Can those be depreciated? Straight-line, 7yrs?

4. Is it reasonable to claim $5,000 in job search expenses (mostly food and gas) with documentation from credit card statements?

 

[EagleKeeper]

Questions:
1. With W-2 and 1099 income for the same line of work, can I allocate 100% of the cost of licenses, medical premiums, malpractice insurance to offset the 1099 income?
Depending on the type of work - Yes - if those items are reasonable for the 1099 type income

2. Is there any additional way to deduct $17k in student loan interest aside from line 33 of the 1040? Line 33 only allows $2,500 max.
It may be possible to classify the interst as an expense for the Schedule C. Reading through Pub 535/Chap 4 - Interest could allow you to classify this as an investment interest if the result of the student loan (degree) leads DIRECTLY to the 1099 income. I am basing this off of being creative in taking a loan to expand/start the business and paying interest on the loan.

3. Books/tools purchased and used during med school (2002-2006) are now used in the line of work. Can those be depreciated? Straight-line, 7yrs?
Yes - but you have to take into account the lifetime from when they were purchased, not when place in use for the business.

4. Is it reasonable to claim $5,000 in job search expenses (mostly food and gas) with documentation from credit card statements?
One can claim. However, the meals would have to have been with a potential client/employer. If you are going to claim the fuel, then also claim the proportional vehicle expenses for maintence and insurance. 5K is an awful lot of driving and at an estimated allowed $35 per diem for food, you will have to have been interviewing for while a long period.

Comments in bold

 

[endervalentine]

I will have toresearch the 1099-B

The other question is referenced a few posts above.

Thanks EagleKeeper ... for the Roth question is it the one posted by zhwu? I went back a few pages and there were only 2 post regarding Roth IRA. Just wondering if I can contribute to the traditional IRA and quickly convert it to a Roth IRA.

Did you find anything on the 1099-Bs?

Thanks again, much appreciated!

 

[EKKC]

Uncle will have the proper instructions for people for those purchases when time comes for filing the 2010 forms

yup. here's what i meant:
http://www.irs.gov/pub/irs-pdf/f5405.pdf

the form title clearly stated attach to 2008/2009 form 1040 or 1040x, never mentioned 2010. that just scared me.

thanks again for all your help eagle keeper

 

[EagleKeeper]

Thanks EagleKeeper ... for the Roth question is it the one posted by zhwu? I went back a few pages and there were only 2 post regarding Roth IRA. Just wondering if I can contribute to the traditional IRA and quickly convert it to a Roth IRA.

Did you find anything on the 1099-Bs?

Thanks again, much appreciated!

Have not had time to research the 1099-B

See post #555 for assistance on the IRA guidelines

 

[Xcobra]

You will have to file the home ownership for 2010.

1) As long as you are under contract by 30 April and close by 30 June; your purchase is eligible.

2) The total credit is $6500 - how you allocate it is up to you.

3) The 5405 is submitted with a copy of the closing statement when you file the 2010 tax return. I have heard of no provision for applying the credit for a purchase in 2010 being able to be applied in 2009.

NOTE: The credit available is based on your filing status at the end of 2010 - not when you purchase the place. So if you tie the knot in 2010 - you will have to apply the joint income limits for the eligibility of the credit

Hi guys, I have multiple questions that I hope I can get answered because I don't think my accountant is giving me all the correct answers,

Background info:
Me and my gf now own a coop apt in nyc (since nov 2004), we are in the process of closing on the sale of a new home as primary residence (retaining the current coop for now). We are at the closing stages (mortgage approved, commitment pending, etc) but not closed yet. Obviously we have to do our taxes now, do we submit the First-Time Homebuyer Credit form 5405 now or wait for tax year 2010? Both our names are on the current and new residence (both deed and mortgage). Must we split the credit 50-50? Can we do 0-100?

1) Are we eligible for $6500 or $8000 credit? We have been in same coop apt for over 5 years, since Nov 2004. Closing the sale of new home this or next month.

2) Can we allocate 0%-100% on the credit instead of 50-50? I'm worried my income is too high to be eligible. (the limit is 125k, I have 1099-based income in addition to my W2 that may put me over that range, but she is safe within the limit) Also of note is we are not married and are filing separately.

3) Do we have to file for the credit and submit the form 5405 now with our (or just her) tax returns? Or is this an amendment (1040x) later down the road? This is the most confusing part. We do not have the closing statement (HUD1) - only the binding contract right now.

I just wanted to point this out: "To qualify, you must have owned and used the same home as your principal residence for at least five consecutive years of the eight-year period ending on the date you buy your new principal residence."

 

[manlymatt83]

As an update to my situation, looks like I'm going to have about 80% of my taxes paid by April 15th. Still going to owe 20%. Would it help to just call one of their representatives at this point and say "So I underestimated my first year as a contractor, so I'm going to owe some money, but i'll have it to you guys by the end of the month" (which is true).

Would calling them help?