No idea but it sounds like fun for you tax guyok i got a question. is the IRS going to audit me when...
we sold 2 houses, made money on both. owned sepertly one by my wife and one by me. lived in both for more than 2 years our of last 5. want to not pay income tax on either property. i have receipts for at least half and spent more on one of them than we made. so ill just increase my cost basis to near what we made and call it a day.
not doing taxes till now because i just got my investment stuff.
I think as long as you lived in each and claimed homestead for 2 years on each, it should be tax free as long as the total sold price for each house was $500k or less. May be different if you owned the houses prior to being married, possibly there will be a number in between or you're stuck at $250k cap.ok i got a question. is the IRS going to audit me when...
we sold 2 houses, made money on both. owned sepertly one by my wife and one by me. lived in both for more than 2 years our of last 5. want to not pay income tax on either property. i have receipts for at least half and spent more on one of them than we made. so ill just increase my cost basis to near what we made and call it a day.
not doing taxes till now because i just got my investment stuff.
I think as long as you lived in each and claimed homestead for 2 years on each, it should be tax free as long as the total sold price for each house was $500k or less. May be different if you owned the houses prior to being married, possibly there will be a number in between or you're stuck at $250k cap.
That said, if it came down to it, if you can prove costs at or above what you sold one of the houses for, and the other is under $500K sales price, I would imagine you'll be fine either way. Even if you get audited, you should be covered.
I have a question for you tax experts...
I was filing my taxes last night and when doing the HSA part, I ended up contributing $300 more than I am allowed to to my HSA.
The tax software told me that I need to withdraw the excess than add it as misc. income on a later part in the form.
I then called my HSA to ask them if that just meant I can withdraw it from there and cut myself a check, and they told me there is this form that I have to fill out, mail it in, and they will mail me back the difference. The thing is, that comes with a $25 fee as well as a 20 business day time frame to do that all.
My question is - is that really necessary? If I just withdraw the excess money, add it in as the misc income (which in turn makes me owe more money to government), is that good enough? I just don't see the whole point of this whole process of having a form like that have to be filled out and make a whole big deal of this process. Also the $25 fee for them to cut me a check pisses me off.
In reality, if I don't do it the form way, is there something negative that could happen to me in the future? I mean if for some reason I was audited, I would have proof that I cut myself a $300 check cause that would leave a paper trail, and they would see me make the change on my taxes with the misc. $300 income.
Anyone have experience with this?
Thanks.What you're describing sounds exactly what I would expect. I would have over-contributed last year - but my HSA custodian kicked back my last paycheck contribution since it was over the max thankfully.
See what others have experienced with this:
https://www.bogleheads.org/forum/viewtopic.php?t=208636
https://www.bogleheads.org/forum/viewtopic.php?t=129117
Thanks.
I think I'm going to just withdraw like $310 and in the notes on the misc income portion, I'll say it's $300 in over contribution + $10 of possible interest, which it will be nowhere near close to what was gained on the extra $300 the past 3 months. But rather be safe than sorry I guess.
I'm not going to bother with the form.
I went through something like this with a 401k rollover.I have a question for you tax experts...
I was filing my taxes last night and when doing the HSA part, I ended up contributing $300 more than I am allowed to to my HSA.
The tax software told me that I need to withdraw the excess than add it as misc. income on a later part in the form.
I then called my HSA to ask them if that just meant I can withdraw it from there and cut myself a check, and they told me there is this form that I have to fill out, mail it in, and they will mail me back the difference. The thing is, that comes with a $25 fee as well as a 20 business day time frame to do that all.
My question is - is that really necessary? If I just withdraw the excess money, add it in as the misc income (which in turn makes me owe more money to government), is that good enough? I just don't see the whole point of this whole process of having a form like that have to be filled out and make a whole big deal of this process. Also the $25 fee for them to cut me a check pisses me off.
In reality, if I don't do it the form way, is there something negative that could happen to me in the future? I mean if for some reason I was audited, I would have proof that I cut myself a $300 check cause that would leave a paper trail, and they would see me make the change on my taxes with the misc. $300 income.
Anyone have experience with this?
They do make you consider the earnings on the over contribution. It's on the form I have to fill out (although I have no clue how I would know that, maybe I'm supposed to leave it blank and they will fill it out). They then cut you a check for over contribution + earnings on the over contribution.Personally, I wouldn't do that I don't think... I don't think they do something like consider the interest you earned on the over contribution - which is literally probably a portion of a penny knowing how shitty in the interest rates typically are.
Either way I guess just make sure you report it all correctly and you should be fine.
They do make you consider the earnings on the over contribution. It's on the form I have to fill out (although I have no clue how I would know that, maybe I'm supposed to leave it blank and they will fill it out). They then cut you a check for over contribution + earnings on the over contribution.
And since that is now income, it has to be reported on your taxes as so.
So I'm pretty sure that I will cover all my bases in this case.
According to what I've read about this, as long as I withdraw it by April 15th, I can put it on last years income.When I got the 1099's for my 401k over contribution, one was for the over-amount and the 2nd was for the interest earnings.
The interest earnings had to be reported for 2018 income, and the over contribution amount has to be reported / corrected on my 2017 taxes.
In other words, I think you still just need to withdraw $300 as any interest earnings will be reported as 2019 income since it will be withdrawn this year.
That could work then possibly. When I requested the return amount, I was not able to specify how much to return. All I could do was submit what I contributed and they calculated the difference and gave the refund, so I couldn't be certain what I would get back. Pretty sure the government only cares that you pay taxes on it one way or the other, so as long as you document what you're doing and why, you should be covered.According to what I've read about this, as long as I withdraw it by April 15th, I can put it on last years income.
Yeah I know exactly how much I overpayed since the limit was $6900. It's just the gains on the contributions that I don't know exactly what it is, so that is why I'm going to just do $10 extra and withdraw $310 then add $310 extra additional income.That could work then possibly. When I requested the return amount, I was not able to specify how much to return. All I could do was submit what I contributed and they calculated the difference and gave the refund, so I couldn't be certain what I would get back. Pretty sure the government only cares that you pay taxes on it one way or the other, so as long as you document what you're doing and why, you should be covered.
I know this topic should be on another thread, but do you guys really think these HSAs are really worth it? I have an HSA that I deposited the maximum of $6,900, but I did it in March of this year to effect 2018 taxes. This pretty much covers my medical deductible. Other than what my company contributes as incentives for 2019, I do not plan to add any more money to this account. If I do have medical expenses in 2019 or in the future that exceeds this $6,900, I will simply make a deposit to the HSA, wait a few days, then file for reimbursement. I feel that I just do not need another investment vehicle since I already have both a Traditional and Roth IRAs. The interest rates pretty much suck at .01%. I could open up an HSA brokerage account and start investing the money there as well, but to me it is not worth the effort, and the only people making out like bandits are the HSAs themselves and brokerage companies.
I know this topic should be on another thread, but do you guys really think these HSAs are really worth it? I have an HSA that I deposited the maximum of $6,900, but I did it in March of this year to effect 2018 taxes. This pretty much covers my medical deductible. Other than what my company contributes as incentives for 2019, I do not plan to add any more money to this account. If I do have medical expenses in 2019 or in the future that exceeds this $6,900, I will simply make a deposit to the HSA, wait a few days, then file for reimbursement. I feel that I just do not need another investment vehicle since I already have both a Traditional and Roth IRAs. The interest rates pretty much suck at .01%. I could open up an HSA brokerage account and start investing the money there as well, but to me it is not worth the effort, and the only people making out like bandits are the HSAs themselves and brokerage companies.
Yes. YES. ABSOLUTELY YES.
An HSA is so powerful, I would argue that it is the best investment you can make. I would max out your HSA before your 401k, IRAs, etc..
There is no other investment vehicle that is TRIPLE tax advantage. That is, no tax before going in - no tax on the interest - and no tax upon withdrawing (presuming it's used for medical expenses). Do NOT take a distribution/reimbursement. LEAVE it in there for 30+ years as it gains interest. SAVE Your medical receipts and you can take those amounts out LATER after it appreciates from investment.
Open an HSA with Fidelity and do an occasional (limited to once a year) rollover to that account - there are TONS of very good investments there. I use their "Zero" investment funds that have zero in fees.
This is assuming that I will live for another 30 years (57 now). Even though I will pay income taxes on the money now for 2019 ($1,518), I can still invest this money and only have to pay 15% long term capital gains when I sell. So tying up $6,900 every year to save $1,518 in taxes each year, and only having access to this money only for medical expenses, just doesn't seem worth it to me. If in the future when I have medical expenses that deplete the HSA, I can just make another deposit of the maximum to reduce the taxes for that year, then reimburse myself.
Also, the firm that does my company's HSA does not have a provision for rolling the HSA to a different brokerage firm. It is stated that we have to use their firm for investments, which have higher fees and higher transactions costs, and limited fund choices. The only way I can roll it out of their HSA is if I leave the company. When I start adding up all the costs, fees, and expenses, with very limited fund choices and no options to buy stocks, it doesn't seem worth it to me to have more in the account than what I need to cover my deductible.
I'm pretty sure you have a right to rollover your HSA at any time - once a year. I don't know what rights custodians have to limit that, but I honestly don't think they have a right to demand that your funds be held with them.
To each their own man, I'm telling you straight up that HSA investments are very very helpful.
Instead of paying that $1,518 in income tax on it you can also avoid that 15% LTCG on the interest. Seems like a win win for me.
I understand if you're short on cash or something though... But if you have the funds to pay for things out of pocket, I highly recommenced what I stated above.