8th Annual Anandtech Tax Time Thread (OP Updated 14th Jan)

[EagleKeeper]

Well boys and girls it's that time of year again. While at times the thousands of regs and tens of thousands of cumbersome forms, worksheets and pages of codes seem infuriating, deep down you all know you love it. Whether it's keeping things in order all year for a quick mid-February filing or a knuckle-clenching, bullet sweating the current April 15th midnight filing, when you've finally filed it's better than sex! So, without further delay, we give you:

The 8th Annual Anandtech Tax Time Thread!!!

First order of business:
Gratutities can be sent to the Moderator beer fund for allowing this thread to be placed every year.:whiste:

Now the legal mumbo jumbo:

All responses to questions (primarily from myself and CPA along with some other valued contributers) are based on our knowledge and understanding of the current tax code. That said, we do not expressly give permission to use our opinions and responses as sole binding measure for any user, the intended or not. Seek out a local expert and a second opinion with any tax inquiry. We will not be held liable for any audit, fine, penalty or other consequence due to any user basing a filing primarily on our responses. In other words, you're on your own.

Please understand that the service provided here is not to be considered as the final say in any tax related question or issue. We advise everyone to take caution with accepting the answers posted here and seek a good tax accountant or tax lawyer when necessary, especially those pesky complicated questions. Additionally Anandtech nor Anand have endorsed myself or the other benevolent responders in this thread. So please don't complain to them if you feel like you got a bogus answer. Finally, this thread is NOT meant to offer advice nor do your taxes for you. It is solely to help clear up questions, concerns or misunderstandings that you may have concerning the 2007 Tax Code. None of the responders take responsibility for your final tax preparation. You do!

Secondly, this is important people:

Please post all tax questions in this thread! We will not, I repeat, WILL NOT, respond to other threads. We strongly encourage all members to post your questions here for the benefit of others. We will NOT respond to PMs unless we request one from you or if there is personal information taht can not be scrubbed to support a question. And finally, please, for the love of all that's good in the world, read through the thread, there is a good chance your question has already been asked and answered.

Questions that have been answered, will be indicated as such ? you will have to dig through the thread anyhow to find it. Should your question have been answered previously, anticipate that sarcasm will be the response. The other threads have been archived and the search function works (now we at on vB).

If the below saves one ATOT member from being a sucker, it will be worth the typing:

**** Warning - Snapshot of IRS Phishing E-Mail ****
IRS Privacy Page

PLEASE NOTE: Do not respond to unsolicited e-mails that claim to come from the IRS, or any e-mail from an unknown party asking you to submit personal, tax, or financial data. The Internal Revenue Service does not use e-mail to request this type of information. Forward suspicious emails to: phishing@irs.gov

If you E-File, the provider will inform you of the estimated time to have a refund issued.
If you mail, allow a minimum of an extra 2 weeks for a refund to be processed.
A good rule is to allow an extra additional week in addition to above, for each month that you delay filing.
Allow an extra week if the funds are being mailed to you instead of being direct deposit.


Now, if you're an ambitious one, you can always trudge through the IRS website for help

Oh, and again please, try not to PM us or any of the other responders unless you are asked to. Instead, post your question here for all to see, because chances are there is another member with a similar issue. The Mods have been requested to lock any/all other threads that show up dealing with tax issues.

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Okay, moving on. This thread is NOT intended to:

-Answer state tax questions. Sorry folks, states are their own beasts. They all have different rules and regs, heck 7 states don't even have income taxes. We are not about to keep up with 43 different state codes. Therefore, we won't be answering state questions. The best way to get an answer for a state question is to call up the State Treasury or Revenue Dept.

- Endorse any tax software. We can safely say that most of the software does it's job well. Without recommending any particular one, you can choose TaxAct, TaxCut, or TurboTax. Additionally, these and many more sites assist you in actually doing your taxes online. Even the IRS website has the ability for you to file online with simple filings.

-Help propagate any illegal tax schemes. Some of us do not appreciate the hospitality of the Federal Government. So keep your schemes out of this thread. Thanks for understanding.

- Start any arguments between the current system, flat tax, national sales tax or any other tax opinion. The thread is to help people, not debate, flame or troll. The Moderators will be asked to intervene for the latter items as needed.

Note: Much of the tax talk that has been heard over the past couple months has been related to the 2011 and beyond. It does not affect the 2010 filing.

We also very busy this year, so may not be responding to questions as fast as in the previous years. However, we have good knowledgeable people that will help to fill in the gaps.

There have been some changes which as we dig them out will be updated in the original post.



Special Items/Credits - Note this is all based on what the IRS has published. follow the links for full details. Some links have not been fully updated for 2010. Thread carefully

The American Recovery and Reinvestment Act of 2009: Information Center
Many of the Recovery Act provisions are geared toward individuals:

• Homebuyer Credit. Homebuyers who purchase by April 30, 2010, and settle by Sept. 30, 2010, may be eligible for a credit of up to $8,000. Documentation requirements apply. See the first-time homebuyer page for more.
  
  
• COBRA. Workers who lose their jobs between Sept. 1, 2008, and May 31, 2010, may qualify for reduced COBRA health insurance premiums for up to 15 months.
  
  
• Education benefits. The American opportunity credit and enhanced benefits for 529 college savings plans help families and students find ways to pay higher education expenses.
  
  
• Home energy efficiency and renewable energy incentives. See what you can do to reap tax rewards.
  
  
• Earned Income Tax Credit. The EITC is bigger in 2009 and 2010.
  
  
• Additional child tax credit. More families will qualify for the ACTC in 2009 and 2010.
  
  
• Making Work Pay Tax Credit. This credit means more take-home pay for many Americans in 2009 and 2010. Make sure enough tax is withheld from your pay with the help of the IRS withholding calculator. See Making Work Pay for more.
  
  
• $250 for Social Security Recipients, Veterans and Railroad Retirees. The Economic Recovery Payment was paid by the Social Security Administration, Department of Veterans Affairs and the Railroad Retirement Board in 2009. To verify whether you received it, call 1-866-234-2942 and select Option 1 or visit Did I Receive a 2009 Economic Recovery Payment? on this website.
  
  
• Money Back for New Vehicles. Taxpayers who bought new cars and certain other new vehicles in 2009 can deduct the state and local sales taxes they paid as well as other taxes and fees they paid in states with no sales tax.
  
  
• Increased Transportation Subsidy. Employer-provided benefits for transit and parking rose in 2009.
  
  
• Up to $2,400 in Unemployment Benefits Tax Free in 2009. Individuals should check their tax withholding.
  
  
• Health Coverage Tax Credit. This credit increased from 65 percent to 80 percent of qualified health insurance premiums, and more people are eligible.

For those of you who enjoy torturing yourself, We present the IRS Web Site. However, this site has most of the answers also.


Previous ATOT Tax Threads

• 2003
• 2004
• 2005
• 2006
• 2007
• 2008
• 2009

The two sites below have restrictions on their usage and any returns must be started through above links for them to be considered for no charge.
they are not available until mid-January

Federal/Intuit Tax Freedom
State/Intuit Tax Freedom

TaxAct states free filing using their online version for Federal.


H&R Block Product Comparison Chart: (not an endorsement)

Chart

All the three main biggies (TurboTax, TaxCut and TaxAct) do the job. Each has slightly different user interfaces and their quirks/irritations. They continually look at the competition and attempt to match them in features the following year. All three area able to import datafiles from each other.

Some will allow multiple Federal efiles for the same license.

All three have state filing.
However, if you have multiple states to work with, you MUST purchase a copy for each state that you need to work with. And some will not handle multiple states easily; which you will not know until after you shell out the extra $$


Some IRS and other Tax Links may not be fully operational until mid January '11 or later



Okay, now that that stuff is out of the way, let's get to some helpful insight.

Deadlines (midnight of the date listed for filing deadlines)

W2 - Companies are required to have your W2 POSTMARKED by January 31st. It is NOT required that you have it in your hands by that date. Let's dispel that myth please.
If you do not receive it by mid February; for ex-employers, call the employer and ask for a copy to be Faxed to you. For current employers, contact your HR department.

1099 - Companies are required to have your W2 POSTMARKED by January 31st. It is NOT required that you have it in your hands by that date. If you do not receive it by mid February, call the employer and ask for a copy to be Faxed to you. Note: 1099s do not have to be sent to you. Individuals that could receive a 1099 are responsible for tracking their own income.

Most Federal returns - 18 April 2011

IRS FAQ Index - contains links for below areas

• IRS Procedures
• Filing Requirements/Status/Dependents/Exemptions
• Itemized Deductions/Standard Deductions
• Interest/Dividends/Other Types of Income
• Pensions and Annuities
• Social Security Income
• Child Care Credit/Other Credits
• Earned Income Tax Credit
• Estimated Tax
• Capital Gains, Losses/Sale of Home
• Sale or Trade of Business, Depreciation, Rentals
• Small Business/Self-Employed/Other Business
• Aliens and U.S. Citizens Living Abroad
• Electronic Filing (e-file)
• Magnetic Media Filers
• Other (Alternative Minimum Tax, Estates, Trusts, Tax Shelters, State Tax Inquiries)
• Individual Retirement Arrangements (IRAs)

Free Filing

Online Free Filing via IRS

Check back with us on January 15, 2011

PMI is deductible if issued after 2006

AMT

2010 Changes
The following changes to the AMT went into effect for 2010. For more information , see Form 6251, Alternative Minimum Tax--Individuals, and its instructions.

AMT exemption amount decreased. The AMT exemption amount has decreased to $33,750 ($45,000 if married filing jointly or qualifying widow(er); $22,500 if married filing separately).

Taxpayers must know their tentative minimum tax to claim certain credits. Taxpayers must complete Form 6251 through line 31 and attach it to their return to claim: the credit for child and dependent care expenses, the credit for the elderly or the disabled, the lifetime learning credit, the nonbusiness energy property credit, the mortgage interest credit, or the District of Columbia first-time homebuyer credit.

Caution. Congress is expected to consider legislation that would increase the AMT exemption amounts shown above and make it unnecessary for you to attach Form 6251 to your return to claim the credits listed above unless you actually owe AMT. If that legislation is enacted, we will update this page as soon as possible. You can also check the 2010 Form 6251 and the 2010 Instructions for Form 6251 once they become available.

Some tidbits accumulated from previous years.

Dependants:

Significant others are able to be declared as a dependent if you provide the support according to the IRS guidelines. (I personally feel that this is a loophole, however, take advantage of it as you desire - I would not push it with multiple SO at the same time ...)SO's children are now allowed based on a IRS notice of 3/08. This can also be used retroactively for the past 3 years.

You are a dependent of your parents if you are under 18 (24 if in school) unless:
You have stood on your own for more than 6 months. Just because you paid for your tuition costs does not mean that you are not a dependent.
Your parents have the option of not declaring you and letting you stand on your own.

If you cover more than 50% TOTAL of living expenses for a "legal" (per IRS definition +/- two generations) relative they can be declared as a dependent.

You can not claim a spouse as a Dependant if filing as Head Of Household

1099

If you get paid with a 1099, you have the option of filing it with your 1040/1040A under misc income or using the Schedule C. Use of the Schedule C (requires a 1040) and allows you to write off expenses directly and some portion indirectly related to that income before taxes. Previous tax threads have provided guidance on items that could be used as expenses in on capacity or another.
Income earned via a 1099 is also subject to the self employment tax as well as the normal expected W2 type taxes.

Mileage - (New numbers are posted)

50 cents per mile for business miles
16.5 cents per mile driven for moving purposes
16.5 cents per mile driven for medical purposes
14 cents per mile driven in service to a charitable organization

Commuting is not deductible expenses.
Commuting between two jobs is.
Mileage to/from school while working (if the education if not primary - ie it supports work) is a deductible expense on the Form 2106 (which requires 1040 and Schedule A).
If school can be considered as supportive of business income, the tuition, fees, books and mileage become a business expense on the Schedule C. Otherwise use the 2106
You can not claim mileage and expenses on the same vehicle.

Moving

Expenses incurred when changing work locations (for any reason) if the location meets the distance test of 50 miles is filed on the Form 3903 and does NOT require a schedule A.

Sales Tax (Still Valid for 2010)

Sales tax is still allowed as an itemized deduction this year. While it can be a little complicated, the main points of this deduction are:
a. Publication 600 is the main reference for this deduction and contains the tables for those of us who didn't keep your receipts all year long.
b. Anyone who itemized can take it, regardless of what state you are in, BUT, if you live in a state with local/state income tax you have to choose to use the sales tax or income tax deduction. You CAN'T have both.
Sales Tax Calculator

Interest Reporting

You are responsible to report interest /dividends over $1.
The payee is responsible for providing you a 1099 form when the payment is over $10.

Business Expense write offs.

Unless your have Self Employment income (use the Schedule C) expenses must fall under the Form 2106 using the Schedule A (Itemizations)

Expenses for clothing is not deductible, unless those items can not be worn out in public for normal use and/or private functions.
Example:
If you have to wear a suit for work, you can not deduct the cost of the suit and dry cleaning.
If you have a military or other Government service type uniform, it is deductible.

Students: (2009 info below - 2010 not posted on IRS Website yet)

Hope Credit is for tuition for the first 2 years of college. = 50%
Lifetime Learning Credit is for any other type of educational advancement. = 20%
Note: If your parents claim you as a dependent, they get the Credits, no matter who pays the tuition.

Books, laptops, etc do not qualify. Those would have to be entered as expenses on the Form 2106 for those that use Schedule A.

Comparison of the Educational Credits (2009)
Lifetime Learning Credit[/b]..................................................... Hope Credit
Up to $2,000 credit per return............................................ Up to $1,800 credit per eligible student
Available for all years of postsecondary education................ Available ONLY until the first 2 years of post-
and for courses to acquire or improve job ......................... secondary education are completed
Available for an unlimited number of years......................... Available ONLY for 2 years per eligible student
Student does not need to be pursuing a degree................... Student must be pursuing an undergraduate degree
or other recognized education credential ............................ or other recognized education credential
Available for one or more courses ..................................... Student must be enrolled at least half time
....................................................................................... for at least one academic period beginning during the year
Felony drug conviction rule does not apply.......................... No felony drug conviction on student's record

There is a new credit similar to the Hope - American Opportunity Tax credit
This covers up to 4 years to a max of $2500. Up to $1000 can be credited even if you have no income

No Double Benefit Allowed
You cannot do any of the following:

Deduct higher education expenses on your income tax return (as, for example, a business expense) and also claim a lifetime learning credit based on those same expenses.

Claim a lifetime learning credit in the same year that you are claiming a tuition and fees deduction for the same student.

Claim a lifetime learning credit and a Hope credit based on the same qualified education expenses.

Claim a lifetime learning credit based on the same expenses used to figure the tax-free portion of a distribution from a covered education savings account (ESA) or qualified tuition program (QTP). See Coordination With Hope and Lifetime Learning Credits in Chapter 7 and Chapter 8 (QTP).

Claim a credit based on qualified education expenses paid with a tax-free scholarship, grant, or employer-provided educational assistance. See Adjustments to Qualified Education Expenses, later.

IMPORTANT 14 Jan 2011
Basically, if you are itemizing or taking an education credit, you will have to delay filing your taxes until sometime in mid (most likely late) February:

For most taxpayers, the 2011 tax filing season starts on schedule. However, tax law changes enacted by Congress and signed by President Obama in December mean some people need to wait until mid- to late February to file their tax returns in order to give the IRS time to reprogram its processing systems.
Some taxpayers – including those who itemize deductions on Form 1040 Schedule A – will need to wait to file. This includes taxpayers impacted by any of three tax provisions that expired at the end of 2009 and were renewed by the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act Of 2010 enacted Dec. 17. Those who need to wait to file include:

• [FONT=&quot]Taxpayers Claiming Itemized Deductions on Schedule A. Itemized deductions include mortgage interest, charitable deductions, medical and dental expenses as well as state and local taxes. In addition, itemized deductions include the state and local general sales tax deduction that was also extended and which primarily benefits people living in areas without state and local income taxes. Because of late Congressional action to enact tax law changes, anyone who itemizes and files a Schedule A will need to wait to file until mid- to late February. [/FONT]
• [FONT=&quot]Taxpayers Claiming the Higher Education Tuition and Fees Deduction. This deduction for parents and students – covering up to $4,000 of tuition and fees paid to a post-secondary institution – is claimed on Form 8917. However, the IRS emphasized that there will be no delays for millions of parents and students who claim other education credits, including the American Opportunity Tax Credit extended last month and the Lifetime Learning Credit. [/FONT]
• [FONT=&quot]Taxpayers Claiming the Educator Expense Deduction. This deduction is for kindergarten through grade 12 educators with out-of-pocket classroom expenses of up to $250. The educator expense deduction is claimed on Form 1040, Line 23 and Form 1040A, Line 16. [/FONT]

In addition to extending those tax deductions for 2010, the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act also extended those deductions for 2011 and a number of other tax deductions and credits for 2011 and 2012 such as the American Opportunity Tax Credit and the modified Child Tax Credit, which help families pay for college and other child-related expenses. The Act also provides various job creation and investment incentives including 100 percent expensing and a two-percent payroll tax reduction for 2011. Those changes have no effect on the 2011 filing season.
The IRS will announce a specific date in the near future when it can start processing tax returns impacted by the recent tax law changes. In the interim, taxpayers affected by these tax law changes can start working on their tax returns, but they should not submit their returns until IRS systems are ready to process the new tax law changes. Additional information will be available at www.IRS.gov.
For taxpayers who must wait before filing, the delay affects both paper filers and electronic filers. The IRS urges taxpayers to use e-file instead of paper tax forms to minimize confusion over the recent tax law changes and ensure accurate tax returns.

Well, sorry for the long post, but just like the IRS code, it takes a lot to do something simple. We have tried to organize it for easier reading by using the quoting method to section areas off.

AGAIN
Questions already answered in the thread may be responded to as "all ready answered". If so, you will gasp> actually have to read this thread
Now, let the questions begin.

 

[ElFenix]

stuck

 

[Homerboy]

I'm in! My taxes are going to SUCK this year.

 

[Saint Nick]

My parents aren't claiming me anymore on their taxes. How will that affect me? I am also now a graduate student, are there any particular deductions I can look at?

 

[Imported]

I'm in! My taxes are going to SUCK this year.

Same.. single, middle class, no dependents, don't own a home.. I get owned every year. Though I did put away more this year so it shouldn't be a huge deal.

 

[Homerboy]

Same.. single, middle class, no dependents, don't own a home.. I get owned every year. Though I did put away more this year so it shouldn't be a huge deal.

No. I mean mine will be confusing as all hell

Unemployed for part of the year
COBRA
1099 for consulting for part of the year
employed for another part of the year (VERY minimal fed taxes withheld
wife owns her own small business.
settled a pile of debts too, so the difference has to be claimed as income.

Ugh. TurboTax is going to be put to the test this year!

 

[Sentrosi2121]

One question I have is that my wife's aunt knows of someone who will 'devalue' your home which somehow will offset the tax you owe. My wife asked if this was something we should look into. I don't like the sound of it and I told her no. But have you heard of things like this? And what would the ramifications of it be to us? (Married couple w/ 2 dependents living in a split family home).

 

[EagleKeeper]

My parents aren't claiming me anymore on their taxes. How will that affect me? I am also now a graduate student, are there any particular deductions I can look at?

You will be able to claim a full exemption on your taxes for yourself and also all the educational credits (HOPE or Lifetime Learning) that might apply and student loan interest.

 

[nickbits]

Taxes are going to rock this year. Will get a refund for the first time ever! Mfj ftw!

 

[ElFenix]

Same.. single, middle class, no dependents, don't own a home.. I get owned every year. Though I did put away more this year so it shouldn't be a huge deal.

same boat. the unmarried, childless, and houseless really get the shaft.

 

[rcpratt]

Oh lawd, I have to do my own taxes for the first time ever.

Single, renting, employed for 7 months of the year after finishing school for the first 4. I think it should be pretty simple, but we'll see. I'm sure I'll have more questions later.

 

[EagleKeeper]

One question I have is that my wife's aunt knows of someone who will 'devalue' your home which somehow will offset the tax you owe. My wife asked if this was something we should look into. I don't like the sound of it and I told her no. But have you heard of things like this? And what would the ramifications of it be to us? (Married couple w/ 2 dependents living in a split family home).

For the Federal government, the value of the home will only come into play when you sell it or purchase it. In between, it has no impact.

The value of the home to the local government impacts the amount of property tax that is owed. One can appeal the tax valuation of the property and then attempt to utilize a professional that will try to get the value of the house lower.

Also, realize that if the home is devalued; your insurance coverage which is tied to the home also is less.

 

[EagleKeeper]

Same.. single, middle class, no dependents, don't own a home.. I get owned every year. Though I did put away more this year so it shouldn't be a huge deal.

same boat. the unmarried, childless, and houseless really get the shaft.

Note that those with live-ins that do not work can get some benefit besides what is between the sheets

 

[roguerower]

Oh lawd, I have to do my own taxes for the first time ever.

Single, renting, employed for 7 months of the year after finishing school for the first 4. I think it should be pretty simple, but we'll see. I'm sure I'll have more questions later.

Same...wonder what will happen. Graduated in May, moved to Texas, started working middle of June. Worked as a student from end of Jan to beginning of May. So I'll have Federal, Virginia, but nothing for Texas.

Powers that be, what is the date range for earnings for 2010? i.e. Feb 1, 2010 to January 31, 2011?

EDIT: Not the first time i've done my taxes, it just feels different now that I'm all alone in the real world.

 

[NikolaeVarius]

Man, I should probably do my taxes for the first time.

I'm still in College, but I make a (small) income now, and I want to see if I can get get some tax credits or something.

 

[Homerboy]

I dont get how people can be doing taxes for the 1st time in or just out of college. I was doing taxes when I had my jobs in HS...

 

[Saint Nick]

I've been doing my taxes since HS, as well. However, I still don't know if I qualify for certain things or not...shit is so damn complicated.

Now that my 'rents don't claim me, I'll probably get super pwn3d. Single, no children, no house. lol.

 

[EagleKeeper]

Same...wonder what will happen. Graduated in May, moved to Texas, started working middle of June. Worked as a student from end of Jan to beginning of May. So I'll have Federal, Virginia, but nothing for Texas.

Powers that be, what is the date range for earnings for 2010? i.e. Feb 1, 2010 to January 31, 2011?

EDIT: Not the first time i've done my taxes, it just feels different now that I'm all alone in the real world.

You are not alone - all of AT is behind you.

Yes, some may be rooting for you to flop, others are just envious that you have a job.


You will get W2's in the mail from your employers. Make sure that the one(s) from Virginia have your current address.

Tax year is considered to be Jan 1 through Dec 31 for indiviguals

You will be able to file a Form 3903 for moving expenses for anything that the Texas employer did not cover.

 

[EagleKeeper]

I've been doing my taxes since HS, as well. However, I still don't know if I qualify for certain things or not...shit is so damn complicated.

Now that my 'rents don't claim me, I'll probably get super pwn3d. Single, no children, no house. lol.

Between your parents claiming you and not claiming you based on the same income, you are better on your own.

 

[rcpratt]

I dont get how people can be doing taxes for the 1st time in or just out of college. I was doing taxes when I had my jobs in HS...

Hey, if one's parents want to claim one as a dependent and get the benefits of that, then they can do one's taxes.

 

[mwtgg]

In on this. Hopefully I'll have some free time to help some people out this year.

 

[roguerower]

You are not alone - all of AT is behind you.

Yes, some may be rooting for you to flop, others are just envious that you have a job.

You will get W2's in the mail from your employers. Make sure that the one(s) from Virginia have your current address.

Tax year is considered to be Jan 1 through Dec 31 for indiviguals

You will be able to file a Form 3903 for moving expenses for anything that the Texas employer did not cover.

Made sure my address was up to date with VT.

I'll look at one of the calcs to see if I have to start saving. I think I paid $1800 or so to move out here and the job paid for most of it. I'll look into the 3903. Thanks for the help. I'll probably ask for more down the line.

EDIT: Wow...looks like no refund for me this year.

 

[LuckyTaxi]

So, I'll be getting marry in May of 2011. A couple of folks suggested that I modify my withholdings to M1 beginning in January while others say to wait until you do get marry. As far as I know, I dont think I have to "prove" that I'm getting marry when I make the change w/ my payroll department. Anyways, I was playing w/ the paycheck calculator on our HR site and to my surprise I would get an extra $180 or so per paycheck. Sounds too good to be true as I think I'll be re-paying it back to uncle sam come tax season. Does that sound about right? I normally have S1 and get an average of $300-$400 when I file my taxes but my 2012 return will definitely be different given that I'll be marry in 2011.

 

[LuckyTaxi]

If I purchase stock A 3 times over the course of last year at different price interval but sold them all at once, how do I report that? Do I have to break it down per each loss since I incur a lost.

Actually I take it back, I've held some of the shares for over a year but did purchase some more recently.

i.e.

2/2009 - Purchase 100 shares @ $4
3/2009 - Purchase 200 shares @ $3
3/2010 - Purchase 200 shares @ $5
8/2010 - Sold ALL 500 shares at $2

 

[dullard]

So, I'll be getting marry in May of 2011. A couple of folks suggested that I modify my withholdings to M1 beginning in January while others say to wait until you do get marry. As far as I know, I dont think I have to "prove" that I'm getting marry when I make the change w/ my payroll department. Anyways, I was playing w/ the paycheck calculator on our HR site and to my surprise I would get an extra $180 or so per paycheck. Sounds too good to be true as I think I'll be re-paying it back to uncle sam come tax season. Does that sound about right? I normally have S1 and get an average of $300-$400 when I file my taxes but my 2012 return will definitely be different given that I'll be marry in 2011.

Unless you and your wife make dramatically different salaries, you'll likely pay right about the same amount of tax as you would have if you never got married. Thus, your withholding should be about the same. Since they are withholding less, you may very well owe money once tax time comes along. There is a "married but withhold as if I were single" option for people who don't want to owe money at tax time.

The best way to do this is to just fill out your tax form right now (with estimated values for everything). That way you know the most likely result since tax laws are unlikely to change much in the next year. Unless you have something unusual, doing it shouldn't take more than a few minutes if you have a currently filled out tax form to use as comparison.

We have a pay as you go system. So, technically, you are supposed to pay a single rate for as long as you are single. Then when you marry, you can adjust the withholding rate if needed. Since the tax is for the whole year, and you will be halfway through, you would have to double correct and then put it all back to normal in Jan 2012.

Or, since no one will likely care, just do it whenever you feel like it once and forget about it.