ATOT's Second Annual Tax Time Thread!

[iversonyin]

I'm single and I have a parttime job for the last year. I made over $5k. Should I file separately from my family? If so, this would be my first year and i am completely clueless

 

[slycat]

Bought and sold a house last year(bought in july, sold in september). Made a little loss due to a $25k renovation bill. Would i be required to send the bill to IRS? Any complications in tax filing that i should be careful of?...i am trying out taxcut software(state and deluxe) so i wanna do taxes my myself.

thanks.

 

[FoBoT]

Originally posted by: iversonyin
I'm single and I have a parttime job for the last year. I made over $5k. Should I file separately from my family? If so, this would be my first year and i am completely clueless

if you are single, what family are you reffering to? your parents? you can still file to get your refund even if your parents claim you as a dependent
if you made that amount, you are likely to get back all you paid

 

[Kenazo]

Attention Canadian peeps, I might be able to help you guys out.

<- Certified General Accountant student, and I work at a public practice firm, so I'm sure I'll be able to track down the answer at least.

 

[jpsmoney]

Wow, I can't believe you have time to do this as a CPA this time of the year. My cpa friends drop off the face of the earth about now. Cheers to you!

 

[Nuriko]

Originally posted by: slycat
Bought and sold a house last year(bought in july, sold in september). Made a little loss due to a $25k renovation bill. Would i be required to send the bill to IRS? Any complications in tax filing that i should be careful of?...i am trying out taxcut software(state and deluxe) so i wanna do taxes my myself.

thanks.

Question, did you intend to flip it, hold onto it as a rental or use it as a personal residence when you first bought it? And depending, how did you finance it. Is the loss an actual cash loss or a paper loss? You can do different things depending on which way you did it. And you don't necessarily have to send the IRS the bills, just keep good records in case of an audit.

But as far as tax treatment, again depending on what sort of renovations (I'm assuming more than just a new coat of paint and cleaning), you add the costs to your basis and then subtract the sale price from your adjusted basis to get a short term capital loss, which goes on your schedule D and can be used against your capital gains and to the limit of $3k, against ordinary income (ex: 80k house, + 25k renovations, and you sold it for 100k, you have 5k of short term capital losses, and if you didn't have any other capital gains, you could deduct 3k of the loss against your ordinary income and carry the other 2k forword; of course, this is a very simple example, without depreciation and other costs).

 

[Insane3D]

Quick question on e-filing. I used Turbo Tax's online version last year, and as of now, I'm probably going to use it again this year. I don't itemize, and when I file, it's usually using the 1040EZ form and I get my refund. What is the cheapest way to e-file a 1040EZ type return? Turbo Tax online seems to be $20, and TaxCut online is $30...anything cheaper out there?

 

[TechBoyJK]

Here's my question. I worked only as an independant contract partimte for 2004. I made about $15,000 for the year. I spent alot of money in gas getting to and from the project, etc. What is the cap on the amount of gas expense I can claim? What else can I claim? What forms do I need to fill out?

 

[sygyzy]

I was granted some stock last year (2004). The stock vested and half was converted to a different company's stock (we were bought) and half was put into cash. Part of cash was given to me and part was kept to be distributed over the next three years (40%, 40%, 20%). I wrote a check to cover the stock purchases (paying less than their value of course). I sold half the stock and made some gains (very little). I still own half.

What are my tax consequences? I assume it is 100% ordinary income? What exactly will be taxed? Will I be taxed on the cash portion that I never received (they are keeping it then slowly releasing it, remember). Do I simply take the value of the stocks, minus the cost, then add that to my yearly income as if I was given all cash?

Do I fall under AMT?

 

[styrafoam]

Last year I exercised some cashless stock options for $$, when I did my taxes with turbotax it figured it as a capital loss even though I am nearly 100% certain I entered all of the info correctly(purchase prices of shares, current market price of shares, taxes and fees, proceeds after sale). As best I can tell it figured the balance of the sale price minus the profits as a loss, which seemed incorrect to me as I fronted no money. I have a feeling I entered the info in an incorrect part of the return preperation(employee stock purchase program) any advice?

 

[Viper GTS]

My taxes are a little complicated this year, I'll take any free advice:

I lived and worked in Oregon until June of 2004. I have lived and worked in PA since June, but have never established residency in PA (I will most likely be returning to Oregon in a few months).

I had two jobs in Oregon in 2004, I quit both in late June. I paid PA state taxes on income since late June (from my new job). In July I received two 401k distributions from two different plans (no state or federal tax withheld). Both were from contributions made from the same company (in Oregon). In addition I have interest from banks in both states (just a few $).

What state returns should I file, &amp; what should be reported on each?

Viper GTS

 

[xospec1alk]

My company requires me to travel to a client site. They give me .15 cents a mile but i hear the federal rate or something is 39 cents, and i should be able to get that money back. is that correct? Also, my work also required that I buy a car for the job and was pretty much stipulated that if i did not have a car i would not be hired, so i bought a car. any way to write that off or something? cuz i really didn't need one until i got this effing job...

 

[amish]

Originally posted by: Insane3D
Quick question on e-filing. I used Turbo Tax's online version last year, and as of now, I'm probably going to use it again this year. I don't itemize, and when I file, it's usually using the 1040EZ form and I get my refund. What is the cheapest way to e-file a 1040EZ type return? Turbo Tax online seems to be $20, and TaxCut online is $30...anything cheaper out there?

free file. basically a tax software company provides free services and filing. the company will probably offer other services but you are under no obligation to buy the said services. in your case, hopefully you will be able to get by on the bare minimum and not pay a dime.

 

[amish]

Originally posted by: xospec1alk
My company requires me to travel to a client site. They give me .15 cents a mile but i hear the federal rate or something is 39 cents, and i should be able to get that money back. is that correct? Also, my work also required that I buy a car for the job and was pretty much stipulated that if i did not have a car i would not be hired, so i bought a car. any way to write that off or something? cuz i really didn't need one until i got this effing job...

business use of car.

first, i have a question. do you travel from your home to a job site, and is that job site a permanent one or temporary?

second, is the car used for anything other than on the job travel? if so, only the costs associated to those miles can be deducted.

ok, lets say that it is a temporary job site and for the sake of ease you only use the car for business travel. you can deduct all the costs associated with the car one of two ways. the standard mileage rate of 37.5 cents or the actual costs (with receipts) of maintaining the vehicle. you have a possiblity to get a larger deduction by using actual costs but the standard rate is much easier.

now, you have to worry about which type of reimbursement plan your employer uses. if they use an accountable plan everything is written down and you are fully reimbursed. since you didn't mention anthing like this i am going to assume that they use a non-accountable plan.

If your employer uses a non?accountable plan to reimburse you for the expenses, the reimbursements should be included in your wages. Your employer will combine the amount of any reimbursement or other expense allowance paid to you under a non?accountable plan with your wages, salary, or other compensation and report the total on your Form W?2. Your employee business expenses may be deductible as an itemized deduction.

ok, now we go on to the filing that you must do in order to claim the deduction.

Generally, if you are an employee, to deduct your car expenses including expenses that exceed reimbursement under an accountable plan, you must complete Form 2106 or Form 2106-EZ and itemize your deductions on Schedule A of Form 1040. Your expenses will be subject to the 2% of adjusted gross income limit.

unfortunately i am not too sure on what to say about your vehicle maybe another member will comment on it. anyways, hope this helps.

amish

 

[AmigaMan]

I sold some stock options (cashless exercise) around November 2004. A part of the stock option agreement said that if my company merged or was bought out by another (which happened in Oct. 2004) my options would vest 100%. I made a small profit off the sale (~$5,000) and was wondering what my tax liabilities are going to be? Will I owe capital gains taxes? I've heard of something called the alternate minimum tax or something, will I be subject to it and if so, what is it? Thanks!

 

[DougK62]

I have a simple mortage interest question. I bought my house in May of last year and paid about $2500 last year in mortgage interest on the note. I'm trying to get a good guess as to how much of this I'll get back. Do I get all of this? A percentage? Is there other factors that weigh heavily on this?

Thank you.

 

[xospec1alk]

Originally posted by: amish

business use of car.

first, i have a question. do you travel from your home to a job site, and is that job site a permanent one or temporary?

second, is the car used for anything other than on the job travel? if so, only the costs associated to those miles can be deducted.

ok, lets say that it is a temporary job site and for the sake of ease you only use the car for business travel. you can deduct all the costs associated with the car one of two ways. the standard mileage rate of 37.5 cents or the actual costs (with receipts) of maintaining the vehicle. you have a possiblity to get a larger deduction by using actual costs but the standard rate is much easier.

now, you have to worry about which type of reimbursement plan your employer uses. if they use an accountable plan everything is written down and you are fully reimbursed. since you didn't mention anthing like this i am going to assume that they use a non-accountable plan.

If your employer uses a non?accountable plan to reimburse you for the expenses, the reimbursements should be included in your wages. Your employer will combine the amount of any reimbursement or other expense allowance paid to you under a non?accountable plan with your wages, salary, or other compensation and report the total on your Form W?2. Your employee business expenses may be deductible as an itemized deduction.

ok, now we go on to the filing that you must do in order to claim the deduction.

Generally, if you are an employee, to deduct your car expenses including expenses that exceed reimbursement under an accountable plan, you must complete Form 2106 or Form 2106-EZ and itemize your deductions on Schedule A of Form 1040. Your expenses will be subject to the 2% of adjusted gross income limit.

unfortunately i am not too sure on what to say about your vehicle maybe another member will comment on it. anyways, hope this helps.

amish

i travel from home to the temporary job site. and its used mainly for commuting to and from the job site, but i take it out on weekends occasionally...so i can deduct maintenance expenses also? like oil changes and whatever?

im not sure what the accountable/non-accountable plan is....usually what happens is we send them the computed roundtrip mileage + tolls, and they will reimburse us based on 15 cents a mile in the "expense" section of the paycheck. i guess i'll have to look at the W2 once that comes in...

and does that mean that i can get the 20 or so cents that i should be getting per mile? all this tax talk is confusing hehe.

 

[EagleKeeper]

Originally posted by: iversonyin
I'm single and I have a parttime job for the last year. I made over $5k. Should I file separately from my family? If so, this would be my first year and i am completely clueless

If your were dependent on you parents for support, it would be best for them tofile you as a dependant and you to file as if you are a dependant.

The easiest way is to use tax S/W to set up a two way scenario of four returns.

Then look at the overall tax burden for the two combinations and choose.

 

[EagleKeeper]

Originally posted by: amish

Originally posted by: Insane3D
Quick question on e-filing. I used Turbo Tax's online version last year, and as of now, I'm probably going to use it again this year. I don't itemize, and when I file, it's usually using the 1040EZ form and I get my refund. What is the cheapest way to e-file a 1040EZ type return? Turbo Tax online seems to be $20, and TaxCut online is $30...anything cheaper out there?

free file. basically a tax software company provides free services and filing. the company will probably offer other services but you are under no obligation to buy the said services. in your case, hopefully you will be able to get by on the bare minimum and not pay a dime.

Also take a look at the size of your refund. If it is not worth the cost of e-filing, consider paper.

If you have a simple return and are getting a large rfund, consider changing your withholding to keep more $$ in your pocket dureing the year.

 

[EagleKeeper]

Originally posted by: TechBoyJK
Here's my question. I worked only as an independant contract partimte for 2004. I made about $15,000 for the year. I spent alot of money in gas getting to and from the project, etc. What is the cap on the amount of gas expense I can claim? What else can I claim? What forms do I need to fill out?

If the income is non-W2 ie. 1099 or self declarated, then you will use the Schedule E for income and expenses relating to that income.

There are no limits on the expenses, just be prepared to document what you claim.

As an independant, most anything that can be claimed as work related can be expensed (either directly or proportionatly). Meals for yourself are about the only thing that will not fly (unless it is a business meal).

 

[Insane3D]

Originally posted by: amish

Originally posted by: Insane3D
Quick question on e-filing. I used Turbo Tax's online version last year, and as of now, I'm probably going to use it again this year. I don't itemize, and when I file, it's usually using the 1040EZ form and I get my refund. What is the cheapest way to e-file a 1040EZ type return? Turbo Tax online seems to be $20, and TaxCut online is $30...anything cheaper out there?

free file. basically a tax software company provides free services and filing. the company will probably offer other services but you are under no obligation to buy the said services. in your case, hopefully you will be able to get by on the bare minimum and not pay a dime.

Thanks...I'll check it out.

 

[Insane3D]

Originally posted by: EagleKeeper

Originally posted by: amish

Originally posted by: Insane3D
Quick question on e-filing. I used Turbo Tax's online version last year, and as of now, I'm probably going to use it again this year. I don't itemize, and when I file, it's usually using the 1040EZ form and I get my refund. What is the cheapest way to e-file a 1040EZ type return? Turbo Tax online seems to be $20, and TaxCut online is $30...anything cheaper out there?

free file. basically a tax software company provides free services and filing. the company will probably offer other services but you are under no obligation to buy the said services. in your case, hopefully you will be able to get by on the bare minimum and not pay a dime.

Also take a look at the size of your refund. If it is not worth the cost of e-filing, consider paper.

If you have a simple return and are getting a large rfund, consider changing your withholding to keep more $$ in your pocket dureing the year.

I'm getting about $850 back this year. I would rather leave it like I have it and get a refund each year.

Edit:

Also, I have no state income tax or sales tax in my state...if that expands my choices for online e-filing. I just need federal done.

 

[woowoo]

CPA
Thank you for starting this thread

I was recently told that "Video Production" is now considerd manufacturing for private contractors(1099).
This would be a higher deduction on the self employment forms
Do you know where on the IRS website that I could find out more on this?
I have searched the IRS site to no avail......

 

[EagleKeeper]

Originally posted by: Viper GTS
My taxes are a little complicated this year, I'll take any free advice:

I lived and worked in Oregon until June of 2004. I have lived and worked in PA since June, but have never established residency in PA (I will most likely be returning to Oregon in a few months).

I had two jobs in Oregon in 2004, I quit both in late June. I paid PA state taxes on income since late June (from my new job). In July I received two 401k distributions from two different plans (no state or federal tax withheld). Both were from contributions made from the same company (in Oregon). In addition I have interest from banks in both states (just a few $).

What state returns should I file, &amp; what should be reported on each?

Viper GTS

If you had state income taxes withheld in PA, you will have to file a PA tax form. The state un-employment tax is so neglible, that it could be ignored if you chose not to file for PA.

It can be your choice if you use a resident or non-resident status in PA.
If you choose resident in PA, then when you file both states, you will have to file as part-time resident.
Depending on the state, expenses will be prorated either based on income of time in the state.

A deciding factor in this case - who picked up the below costs.

Costs of moving from Oregon
Expenses for living in PA.

If you do not claim a residency change, the above two items are then business expenses. Either Schedule E or Form 2106 depending on how the PA income is handled.

If you have a residency change, the only the cost of moving is covered on Form 3903.
Without residency change, Oregon should handle the income as if you were working next door in another state (ex WA, CA) but living in Oregon. They should have to guidelines on how to handle this situation.

Tax S/W at times may handle this for you, but not likely with multiple states involved and both having income taxes withheld.


I had this similar situation last year. Worked in PA, lived in NV.
I did not claim a residency change. Luckly, NV has no income tax. and I had my client not withhold any state taxes.

 

[EagleKeeper]

Originally posted by: Insane3D

Originally posted by: EagleKeeper

Originally posted by: amish

Originally posted by: Insane3D
Quick question on e-filing. I used Turbo Tax's online version last year, and as of now, I'm probably going to use it again this year. I don't itemize, and when I file, it's usually using the 1040EZ form and I get my refund. What is the cheapest way to e-file a 1040EZ type return? Turbo Tax online seems to be $20, and TaxCut online is $30...anything cheaper out there?

free file. basically a tax software company provides free services and filing. the company will probably offer other services but you are under no obligation to buy the said services. in your case, hopefully you will be able to get by on the bare minimum and not pay a dime.

Also take a look at the size of your refund. If it is not worth the cost of e-filing, consider paper.

If you have a simple return and are getting a large rfund, consider changing your withholding to keep more $$ in your pocket during the year.

I'm getting about $850 back this year. I would rather leave it like I have it and get a refund each year.

Edit:

Also, I have no state income tax or sales tax in my state...if that expands my choices for online e-filing. I just need federal done.

As long as you did not get your income from Taxachusetts, free e-file is the way to go.