New answers tagged

0

YES if you are correctly filing 1040 (i.e. you are a US citizen or LPR = green-card holder, even though living elsewhere) you can take the standard deduction, and if your correct filing status was single (and not elderly or blind) for 2019 that amount is $12,200. Regardless of whether (some or all of) your income has been excluded on form 2555. It's the same ...


0

Some (all?) of the tax software allows you to specify the date you want the tax payment to be withdrawn from your bank account by the tax authority. I have used this feature in the past to file early, but wait until the day before tax due date to pay the money I owe. This essentially removes the obligation to remember to do the 2nd part in May. The risk you ...


1

The deadline to file and pay 2020 income taxes, both federal and New Jersey, is May 17, 2021. Since it sounds as if you plan to pay by then, you will be on time.


0

This is absolutely fine for both federal and state, I have done it many times. Of course if you have underpaid throughout the year and owe interest, it will continue to accrue until you pay in full.


1

Your friend's CPA must be wrong, but that doesn't mean that your CPA is right: Having signed a TIC agreement, you cannot be compelled to create a JV just to enable you to file taxes. The IRS has a "come as you are" approach. The IRS does not go around forcing people to change their business arrangements. Seriously, they have enough to do without ...


0

You can claim a credit for (some of) the foreign tax shown in Box 7. See the instructions for Form 1116; the idea is that you list all your foreign income by country and compute the amount of credit you can claim. If certain conditions apply (mostly if the amount of foreign tax paid is small), you don't have to file Form 1116 separately, but can just claim ...


4

You probably won’t be getting any tax forms from them, but it doesn’t matter. Your business needs to declare all of its revenue, whether you get a 1099 or not. Add in whatever they paid you in 2020 to the other freelance revenue you had when you do your taxes.


0

For each major stock exchange there is typically an index that is more or less representative of the level of the stock market trading at that index: Dow Jones, Nasdaq 100, S&P500, FSTS100, Eurostoxx, etc Such an index can be computed using various methods such as price average (Dow Jones), market cap weighting (S&P 500), etc. with dividends (DAX) or ...


0

First looking at it from the view of the giver of $20,000: The receiver isn't a charity, so they won't be writing it off their taxes. Because it is above the $15,000 gift limit they must document it if they want to count it as a gift, but that will mean that will require information from the recipient. They giver will either owe taxes now, or eat into their ...


4

I don't believe any situation can exist between individuals where an amount would be rightfully considered a taxable gift from the giver and taxable income to the recipient. People may argue about whether or not an item is a gift, but I've never seen any portion of tax code that indicates something can be both a gift and not a gift at the same time. In US ...


5

Employers are supposed to report employer contributions to the HSA (and any employee contributions made through payroll deduction) on the Form W-2 in Box 12 with a code of “W”. That amount should not be included in Box 1 on the W-2, meaning that you don’t pay any tax on that amount. The contribution is automatically deducted from your income tax that way ...


5

I think that 2008 was the last year before electronic filing took place. My 8949 form was 832 pages (over a ream and a half of paper!) and it took me all day to print it. Now, brokerage firms report 1099 and 8949 forms to the IRS and I just report the 8949 totals. I've never had a complaint from the IRS since 2008.


4

One way to get them there is to import them electronically - many brokers and most tax software support this. I got 2300 transactions from one broker imported (and submitted to the IRS) without a problem; but I can‘t tell you how TurboTax spread it technically on many pages, I never looked. Alternatively, you can total them for each category, and enter one ...


2

Asset monetisation is the process of unlocking the value of investment made in public assets which have not yielded appropriate or potential returns so far. The Minister informed that an Asset Monetization dashboard will also be created for tracking the progress and to provide visibility to investors. According to https://journalsofindia.com/national-asset-...


2

In this case your mother is considered a "nominee" of the actual owner of the property (you). IRS covers this scenario in instructions for Form 8949: You received a Form 1099-B or 1099-S (or substitute statement) as a nominee for the actual owner of the property Your mother would add the following to her 8949: Enter code N in column (f) Report ...


0

In all likelihood you will save some money by receiving the USD and CHF in your USD and CHF Revolut accounts, and then handling the conversion back to GBP yourself within Revolut. Revolut use the real-time interbank exchange rate so you are getting a good, more transparent, rate at a given point in time. (The only scenario when this method wouldn't be more ...


8

No. There are two parts to the stimulus payment: the advance refund (the "check") and the tax credit (in the case of the third stimulus payment, it's a tax credit for the 2021 tax year). For the advance refund, you received the correct amount; and for the tax credit, the lowest it can be is 0 (it cannot be negative). Let's look at the text of the ...


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The IRS has done a good job of creating a FAQ for each change in the tax law regarding these payments, they have even updated them as the situation has changed: From the IRS: Questions and Answers about the Third Economic Impact Payments — Topic H: Reconciling on Your 2021 Tax Return I received a Third Economic Impact Payment. Do I need to pay back all or ...


2

It depends on which safe harbor you are going for. If you are trying for the safe harbor of paying 100% (or 110% for high earners) of last year's tax liability, then yes, you can just pay 1/4 of that amount each quarter and be sure that you won't have a penalty. If you are trying for the safe harbor of paying 90% of this year's tax liability, there are 2 ...


3

Yes, you can pay estimated taxes in equal amounts and avoid a penalty, provided you still meet one of the safe harbors. If you look at Form 2210 - Underpayment of Estimated Tax by Individuals, Estates, and Trusts, you figure the minimum amount you need to pay for the year to meet one of the safe harbors (line 9), then divide by 4 (line 18). Only if you pay ...


0

Every year has 53 weeks as there are no years with only 364 days (52 * 7) If you are paid weekly you may have only 52 payslips in a particular year – but as to which years, this depends on which day of the week your payslip is issued.


0

From what I understand from the IRS 2020: The source of your earned income is the place where you perform the services for which you received the income. Foreign earned income is income you receive for performing personal services in a foreign country. Where or how you are paid has no effect on the source of the income. For example, income you receive for ...


1

I'll answer some of your easier questions first. :) There will be no penalty for you, because there is no tax due. The penalties are all based on how late you were in paying your tax bill, and because you are due a refund, there is no penalty. If you were to simply refuse to file your tax return in which you were due a refund, your only penalty would be ...


0

From Publication 970 (PDF), page 63, it seems that you do not need a "matching document": An amount is rolled over if it's paid to an ABLE account or another QTP within 60 days after the date of the distribution. Note. Under COVID-19 emergency relief, the student could roll over these amounts by July 15, 2020, if the 60-day period ends on or after ...


3

The US has progressive tax brackets, meaning that the tax rates increase as you go up in tax brackets. For example, for 2020 for married filing jointly, the first $19,750 of taxable income is taxed at 10%; the next $60,500 of taxable income is taxed at 12%; and the next $90,800 of taxable income is taxed at 22%, etc. (And there's also effectively a "0% ...


2

If you realize a loss and within 30 days before or after that loss you acquire replacement shares, you incur a wash sale violation. That means that loss must be deferred and the cost basis of the replacement shares must be adjusted. If you close such positions before the end of the current year, you get claim your loss. If you carry wash sale violation ...


3

I'm assuming you file jointly. The income of the second spouse is taxed at the "incremental" tax rate. In your case this income is taxed (more or less) in the 22% bracket, so the incremental tax on your spouses income would be $6600 dollars, which is more than the withholding. You can do it the other way around and see the same effect: if you start ...


1

Each person's stimulus payment and amount are determined independently according to that taxpayer's tax situation and the rules in the law. Different people's stimulus amounts are not connected. From what I can tell, the stimulus amounts received by both of you are correct according to your tax situations and the law, and therefore nothing needs to be, or ...


1

You don't mail in most 1099s. They are a reference for you to know what your bank/brokerage has reported to the IRS. As @dave_thompson_085 pointed out, that for paper filings certain documents with withheld tax needs to be submitted. The IRS requests that a copy of 1099-R be submitted. If you have a online account, you should be able to download them. ...


1

Were you supposed to receive them? Or were they lost/misplaced? If the amounts are too low they don't have to issue a 1099. But if they were lost you may be able to get a replacement. Are they available on the website? Many 1099s, 1098's, and W-2's I see only exist as a PDF file. The pdf can of course be printed.


1

If I set up my own non-profit (501c3) entity, is it possible for me to donate any or all of my sources of income to offset my tax burden for this year, and if so what percent of each of my sources of income am I allowed to contribute to it annually to offset my tax burden? You and your LLC are different entities from the 501(c)(3) entity that you propose to ...


-1

I am not a tax adviser nor do I have any personal experience with this situation so take this with a grain of salt. As I understand it, Section 1256 contracts are marked-to-market daily and the unrealized gains and losses open at the end of the year are reported at the end of the year for tax purposes. Here are some references: A Section 1256 contract is ...


0

There are a couple of options for you with nearly equal value. It mainly depends on your goals, but the differences in outcome are minimal. Are you attempting to get a head start on retirement? Are you just trying to get your extra money to work for you? Roth IRA. This option is fine because you will never have to pay taxes on this money, and you can ...


1

No. You are not paying taxes now and presumably for the next few years. A brokerage account would give you the same benefits of Roth IRA except you have access to the money if you need it. You know when you might be have to start paying taxes. The year before you graduate so you could realize all the gains you have or if you left them along they would be in ...


2

If you can assume: you know that watching your real IRA grow isn't a better teacher than watching a simulated portfolio, and you're starting a high-paying job post-graduation Then no, I wouldn't recommend putting your high-value dollars into an IRA now. Save it instead of risking you'll need the money, then invest it all once you build up an emergency fund....


0

My kids did this exact thing. We had talked about putting money into a retirement fund. The Roth IRA made the most sense because they if they paid income tax on the contribution (0%) they could withdraw it tax free in retirement. The general guidance is that if the tax rate in retirement will be higher, then you want to use a Roth. One of the best parts ...


1

Not exactly. In 2021 you would claim $500 of interest income, not a $1,000 deduction in 2020 and $1,500 income in 2021. The accrued interest you pay is not really an "expense" since you get it back at the next coupon payment (or when you sell the bond, whichever comes first). This is included in the instructions for Schedule B: Accrued interest. ...


0

This is a great question and the answer is a bit dependent upon other factors in your life. Presumably you earned less than $400, not a lot, although you should be proud. To me it boils down to how can we change that into "life-changing money"? Putting it in a Roth is a great idea and certainly not a bad one. For every $100 you invest in a Roth it ...


3

There is a procedure for returning a stimulus payment. However, it is unclear exactly when it is required to return it and when it is not required. It seems logical to me (although tax regulations do not always follow logic) that if the stimulus payment was paid because of your own error, you would probably be well-advised to return it (Example 1, Example 2)....


38

You are correct that if your income is low enough that you don't have to pay taxes, then a Roth will let you avoid taxation at both ends, because Roth withdrawals are tax-free. You are also correct that you can contribute only earned income to the Roth. More specifically, you cannot contribute more to the Roth than your taxable compensation in that tax year....


0

There's insufficient information to determine if you will be super in trouble at tax time. When you have a wash sale occurs in a non sheltered account, the loss is added to the cost basis of the replacement shares and some/all of the loss is carried forward with each subsequent transaction until the position has been fully liquidated for more than 30 days. ...


2

If at year end, you held no positions and did not buy any of the stocks sold at a loss early in the year (within 30 days of the sale at a loss), it’s over. The washes all are accounted for. A lot of calculations, but you have a net loss. $3000/year against ordinary income or against new gains.


3

If your capital losses exceed your capital gains, you can deduct up to $3k from your income and the remainder above the $3k loss is carried forward. If in the following year your gain exceeds the carryover loss, you would use all of the carryover loss as an offset. You would not be limited to only $3k. In your example, you would have a capital gain of $7,...


7

You can only deduct expenses that you actually pay. If you are not paying anything to rent the space, you cannot deduct it. There is a home office deduction, but since you do not own or rent the home in question, you cannot take the deduction.


2

How do crypto exchanges evade the same level of responsibility/regulation of equity markets or banking? Regulation, in general, is not the same thing as required tax reporting (or actual tax, for that matter). Who is and is not required to do information reporting and in which cases is set out, usually in detail, in the law enacted by Congress, interpreted ...


1

I am experiencing the same issue as the OP, except I filed mine through TurboTax on February 11, and there's still no record of it with the IRS, even though I did get an email confirmation from TurboTax that it had been accepted. When I finally did reach someone at the IRS, they said they couldn't see it frmo their side, whatever that means, and when they ...


1

First of all, let me clear up a misconception: It is not illegal, immoral, or fraudulent to put whatever numbers you need to on your W-4 to get the right amount of tax withheld from your paycheck, even if those numbers don’t necessarily match reality. The W-4 only goes to your employer, not the IRS, and it is only used to calculate withholding. Think of the ...


-1

See https://www.irs.gov/instructions/i2555 You qualify to exclude your foreign earned income from gross income if both of the following apply. You meet the tax home test You meet either the bona fide residence test or the physical presence test


1

Even though it was an all-stock merger, Viatris in their form 8937 says that US shareholders should declare a realized gain/loss as if they had sold their Mylan shares for $15.66. In the future, if you sell your Viatris shares, you will have another capital gain/loss with a new basis of $15.66.


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