*** OFFICIAL 2018 Tax Thread for Anandtech ***

[ctbaars]

The new tax laws are complete garbage for me. My refund is over $3k less than last year. I lost out on $5k+ on property tax deductions.

1%'ers like you should pay more ...

 

[ctbaars]

Yup. It's complete and utter shit and fuck you again Trump.

I went from like $42k deductions last year to $24.5k this year. We went from getting back like $3k to owing $150.

My mom and stepdad went from getting back $8k last year to owing $3k this year. We make probably around double or more than double what they make.

$42K ?? HS! Sounds like you 10%'er ATOT'ers need to vote democrat so you put in your full 90%.

 

[zinfamous]

$42K ?? HS! Sounds like you 10%'er ATOT'ers need to vote democrat so you put in your full 90%.

pretty sure Purebeast isn't pulling in something like ~$300m per year, which is where that full "90%" would actually kick in. Do you understand how the marginal rate works?

You might be interested to learn that when the marginal rate was in effect in this country, that top end rate pretty much only applied to 1 or 2 individuals in the entire country, in any given year. Which would still be easy to avoid because such people instead re-invest that money into their actual businesses--you know, employee salaries, R&D, pension funds, etc...that thing that actually created the middle class. It's an incentive: wouldn't you rather reinvest that money in your business and your people, rather than give it to the feds? You know--the incentive that actually worked, for something like 80 years, instead of the lie sold to this country that, just giving that money to the handful of bosses, no question, would somehow see that money "filter back to the people!" ....which is a weird thing to claim. Because that is exactly what was happening before.

Still, if you sit under whatever the defined income threshold would be (current plan is $10 million), you still pay, essentially, the current rate on that income.

 

[purbeast0]

If I was making $300m/yr I wouldn't be here and neither would ATOT because I would have bought it and shut it down just to piss you all off.

Last year with whatever is included in the SALT stuff we had $24k in deductions in that alone. We had very close amounts this year, however it was capped at $10k.

Then there were these 2 other deductions that simply are gone this year. One was $8k and one was $10k. I don't remember exaxtly what they are right now, but on the software I use (freetaxusa) it shows your 2017 right next to your 2018 column with a little ? icon over each cell so you can see why there are differences.

So yeah, went from $42k deduction to $24.5k.

 

[s0me0nesmind1]

Just finished my first pass on my federal taxes. Betterment's Tax Loss Harvesting means I had a net negative capital gains. (Though I got way more dividends than negative capital gains.)

I just wish my tax software didn't force me to check every entry in my 1099. I had over 400 this year! Fortunately, my tax software suggested I combine most of those into short-term and long-term capital gains categories, which left only about 30 wash sales I had to treat separately. I wonder whether wash sales under $0.50 can be combined too; but I didn't this year.

It looks like my refund will be about the same as last year. Combine that with extra money in each paycheck, which adds up to about the same as the refund, and that's a net win for me.

I wish I had your problems. God damn how many accounts do you have to receive 400 1099s? You live and have all your income based on day-trading or something?

I just do a little bit on the side with Robinhood with "fun money" - and so far I haven't been able to do much strategizing (Tax loss harvesting, etc.) because for the most part most of them have been significant gains (e.g. Bought TSLA for $250, sold at their peak of ~$360). I'm also antsy with how Oct-December were I feel like another dip is coming and as much as I want to turn them into long-term gains I get scared and take the safe bet of taking the gain.

I was actually listening to NPR yesterday and they made a comment about investing: In terms of selling stocks, monkeys throwing darts randomly at a board easily beat investors and their sell gains. However, the investors won when it came to when to buy.

The problem there obviously? People don't know when to let go. Which I totally get, it's like a drug and you're always like "Just a little bit more".

 

[ctbaars]

pretty sure Purebeast isn't pulling in something like ~$300m per year, which is where that full "90%" would actually kick in. Do you understand how the marginal rate works?

You might be interested to learn that when the marginal rate was in effect in this country, that top end rate pretty much only applied to 1 or 2 individuals in the entire country, in any given year.

Still, if you sit under whatever the defined income threshold would be (current plan is $10 million), you still pay, essentially, the current rate on that income.

Yes I do. I was being hyperbolic. (It's why I said 10%'er and not 1%'er)

 

[Ken g6]

God damn how many accounts do you have to receive 400 1099s?

400 sale transactions in one 1099. My tax software wants me to look at every one. They're practically all automated by Betterment.

Edit: https://www.betterment.com/tax-loss-harvesting/

 

[s0me0nesmind1]

400 sale transactions in one 1099. My tax software wants me to look at every one. They're practically all automated by Betterment.

Edit: https://www.betterment.com/tax-loss-harvesting/

Sorry, misunderstood your quote of "I had over 400 this year!"

Hows their overall fees on your investments with it providing services like auto tax loss harvesting? They do any other trades for you automatically?

 

[Ken g6]

Hows their overall fees on your investments with it providing services like auto tax loss harvesting?

.25%. Not as good as I'd like.

They do any other trades for you automatically?

They also re-balance your accounts, excluding their "Smart Saver" bond account, which isn't 3% interest, but is insured by SIPC.

Re-balancing sales are less likely to occur if you contribute to your account regularly; but more likely to occur if you donate stock to a charity and don't buy replacement stock at the same time.

I can't think of any other automatic trades.

 

[RearAdmiral]

I'm awfully curious to see how the new tax laws have affected charitable giving. Has anyone increased / decreased giving based on the new laws? Since I don't hit the 24k deduction none of my charitable giving "counts". I could understand how this would prevent folks from wanting to donate.

 

[highland145]

I'm awfully curious to see how the new tax laws have affected charitable giving. Has anyone increased / decreased giving based on the new laws? Since I don't hit the 24k deduction none of my charitable giving "counts". I could understand how this would prevent folks from wanting to donate.

Doubled up at the end of 2017. Gave next to nothing 2018. Will double up 2019. Rinse and repeat.

 

[s0me0nesmind1]

I'm awfully curious to see how the new tax laws have affected charitable giving. Has anyone increased / decreased giving based on the new laws? Since I don't hit the 24k deduction none of my charitable giving "counts". I could understand how this would prevent folks from wanting to donate.

Personally doesn't affect me since I took the standard deduction (12.7k) even prior to the tax reform.

Also in general I think the concept of itemized / standard deductions to be fucking dumb to begin with. If you want to give something a tax advantage, it should just be stacked ontop of the standard.

 

[RearAdmiral]

Personally doesn't affect me since I took the standard deduction (12.7k) even prior to the tax reform.

Also in general I think the concept of itemized / standard deductions to be fucking dumb to begin with. If you want to give something a tax advantage, it should just be stacked ontop of the standard.

Yes that would be nice!

 

[s0me0nesmind1]

Yes that would be nice!

....But at the same time I don't think we should get deductions from stuff like SALT, Mortgage interest, etc...

Now incentivizing new technologies (electric cars, solar energy, etc...) and incentivizing donations? Absolutely.

 

[ctbaars]

If you are giving money to a charity because of the tax code, there is something wrong. I donate but it has absolutely nothing to do with the code. Besides, I don't think the government should be "incentivizing" religion and para-church activities.

 

[highland145]

If you are giving money to a charity because of the tax code, there is something wrong. I donate but it has absolutely nothing to do with the code. Besides, I don't think the government should be "incentivizing" religion and para-church activities.

I'd give regardless but you can bet your ass I'll avoid the taxes if I can.

 

[RearAdmiral]

I'd give regardless but you can bet your ass I'll avoid the taxes if I can.

Absolutely.

 

[MrEgo]

Thanks for starting this thread. Here is my question:

I live with my partner, and we've lived together since 2016. We have a child together and she's a stay at home mom and I provide 100% of the income. I am filing as head of the household, and I would like to claim her as a dependent on my tax return, which it appears that I am eligible for a $500 tax credit if I do that.

However, her 7 year old son lives with us half-time. He is not my son, and since my partner and I are not married, he does not qualify as my step-son. Every other year she gets to claim him as a dependent, and this is the year that she does get to claim him.

So, my question is, can she (as a dependent of me if I am listing her as a dependent on my return) claim her son for the child tax credit on her return? Or does being a dependent make you somehow ineligible to claim a child as a dependent?

Thank you so much for your clarification if you're able to give any.

 

[s0me0nesmind1]

Thanks for starting this thread. Here is my question:

I live with my partner, and we've lived together since 2016. We have a child together and she's a stay at home mom and I provide 100% of the income. I am filing as head of the household, and I would like to claim her as a dependent on my tax return, which it appears that I am eligible for a $500 tax credit if I do that.

However, her 7 year old son lives with us half-time. He is not my son, and since my partner and I are not married, he does not qualify as my step-son. Every other year she gets to claim him as a dependent, and this is the year that she does get to claim him.

So, my question is, can she (as a dependent of me if I am listing her as a dependent on my return) claim her son for the child tax credit on her return? Or does being a dependent make you somehow ineligible to claim a child as a dependent?

Thank you so much for your clarification if you're able to give any.

Sadly I think you're in for some bad news overall

First as far as claiming your Partner as a dependent: Qualifications

The IRS rules provide that there are really two types of dependents:

1. a qualifying child
2. a qualifying relative

What does this tell me? From the very get-go, you cannot claim your "partner" as a dependent unless they are one of two above. Let me know if you disagree with that, but that is my general understanding.

So with that said, your partner can then claim their child on their own tax return. I understand that your partner doesn't have any income - However, since the Child tax credit is a partially refundable tax credit, that shouldn't be an issue. You would basically file a $0 income tax return with the child as a dependent under your partner.

Next up is Head of Household. See: https://turbotax.intuit.com/tax-tips/family/guide-to-filing-taxes-as-head-of-household/L4Nx6DYu9

You don't seem to meet the qualifications for "Qualifying Child" or "Qualifying Dependent" to file under Head of Household IMO.

Sounds like you will be stuck filing single for yourself and your partner for the year of 2018.

Let me know if you disagree or have any questions.


EDIT: Re-read your post a little and noticed this particular quote:

We have a child together

When you say that - you aren't referring to the 7 year old son are you? You're referring to another child that you had with your partner right? If that is the case you would then be able to file as head of household in that case, but I still don't think you would be able to claim your partner or her child under you.

 

[MrEgo]

Sadly I think you're in for some bad news overall

First as far as claiming your Partner as a dependent: Qualifications



What does this tell me? From the very get-go, you cannot claim your "partner" as a dependent unless they are one of two above. Let me know if you disagree with that, but that is my general understanding.

So with that said, your partner can then claim their child on their own tax return. I understand that your partner doesn't have any income - However, since the Child tax credit is a partially refundable tax credit, that shouldn't be an issue. You would basically file a $0 income tax return with the child as a dependent under your partner


Next up is Head of Household. See: https://turbotax.intuit.com/tax-tips/family/guide-to-filing-taxes-as-head-of-household/L4Nx6DYu9

You don't seem to meet the qualifications for "Qualifying Child" or "Qualifying Dependent" to file under Head of Household IMO.

Sounds like you will be stuck filing single for yourself and your partner for the year of 2018.


Let me know if you disagree or have any questions.

I'm not sure why I would not be eligible for Head of Household? My son lives with me full time.

And here is what I found for the rules for domestic partners:
https://turbotax.intuit.com/tax-tips/family/claiming-a-domestic-partner-as-a-dependent/L2EGb24N1

I also went through the IRS's "test" to see if I can claim my partner as a dependent, and she checked out:
https://www.irs.gov/help/ita/whom-may-i-claim-as-a-dependent

That seems to be new for 2018.

 

[s0me0nesmind1]

I'm not sure why I would not be eligible for Head of Household? My son lives with me full time.

See my edit - I confused your son with your partner's child. Absolutely correct if you and your partner had a child together that you were taking care of.

And here is what I found for the rules for domestic partners:
https://turbotax.intuit.com/tax-tips/family/claiming-a-domestic-partner-as-a-dependent/L2EGb24N1

I also went through the IRS's "test" to see if I can claim my partner as a dependent, and she checked out:
https://www.irs.gov/help/ita/whom-may-i-claim-as-a-dependent

That seems to be new for 2018.

You look to be correct here based on the IRS tool - Also misread my source, your partner likely qualifies as

member of your household for the entire year.

presuming your partner literally lived with you the entire year of 2018.

I would still have to stand by my statement though as far as claiming your partner (or your partner's child) as dependents. I don't believe that they would meet the qualifications since they are not "a qualifying child" or "a qualifying relative"

 

[MrEgo]

See my edit - I confused your son with your partner's child. Absolutely correct if you and your partner had a child together that you were taking care of.




You look to be correct here based on the IRS tool - Also misread my source, your partner likely qualifies as presuming your partner literally lived with you the entire year of 2018.

I would still have to stand by my statement though as far as claiming your partner (or your partner's child) as dependents. I don't believe that they would meet the qualifications since they are not "a qualifying child" or "a qualifying relative"

I'm not trying to claim my partner's other son as a dependent. The IRS tool that determines qualifying children already determined that I cannot claim him as a dependent even though I am supporting him financially. I want my partner to claim him as a dependent, but if I am claiming her as a dependent, does that disqualify her from adding him as a dependent?

 

[s0me0nesmind1]

I'm not trying to claim my partner's other son as a dependent. The IRS tool that determines qualifying children already determined that I cannot claim him as a dependent even though I am supporting him financially. I want my partner to claim him as a dependent, but if I am claiming her as a dependent, does that disqualify her from adding him as a dependent?

Actually, Based on the IRS tool you linked, I don't see any issues with you claiming your stepson on behalf of your partner? Based on the presumption that she isn't making any income (based on your previous statements). This is your step child. You supported him for more than 50% of the time (Since everything your partner supports is 100% from you).

But ultimately, I do not see anything under your partner that disqualifies her from claiming her son. Typically the main culprit as far as dependents is that they are not claimed twice. Since it is her turn to take her son as a dependent I do not see an issue there. From a tax benefits perspective, it would be more benefitial under you since you are actually paying taxes the credit will likely be more beneficial under you.

 

[MrEgo]

Actually, Based on the IRS tool you linked, I don't see any issues with you claiming your stepson on behalf of your partner? Based on the presumption that she isn't making any income (based on your previous statements). This is your step child. You supported him for more than 50% of the time (Since everything your partner supports is 100% from you).

But ultimately, I do not see anything under your partner that disqualifies her from claiming her son. Typically the main culprit as far as dependents is that they are not claimed twice. Since it is her turn to take her son as a dependent I do not see an issue there. From a tax benefits perspective, it would be more benefitial under you since you are actually paying taxes the credit will likely be more beneficial under you.

How does the IRS define “Stepchild”? Since my partner and I are not married, I assumed that her oldest son had no legal relation to me.

 

[skull]

Stupid turbo tax keeps telling me I don't qualify for the home office deduction because I didn't show a business profit. Which is ridiculous because I made way more money this year than last year. I don't know if its something to do with QBI throwing something off or what and its just the way turbo tax is explaining it to me. Either way I definitely have a business profit and I've qualified for the home office deduction the last 6 years.

I actually did my taxes super early this year but heard to wait until at least march to file. To give time for the QBI pubs to get written and updated in turbo tax. Guessing there is still a glitch somewhere and I need to wait longer.