Search found 871 matches

by MarkNYC
Thu Aug 13, 2015 2:10 pm
Forum: Investing - Help with Personal Investments
Topic: Non Deductable IRA
Replies: 24
Views: 1191

Re: Non Deductable IRA

The advice that the OP cannot make a deductible IRA contribution may or may not be correct. He/she said that the purpose of the rollover to an IRA was to get out the employer 401k due to "horrible investment options." So he may no longer be an active participant in the employer 401K plan. ...
by MarkNYC
Sat Aug 08, 2015 9:24 pm
Forum: Investing - Theory, News & General
Topic: Allan Roth Says Not to Load Up on Muni Bonds
Replies: 101
Views: 7962

Re: Allan Roth Says Not to Load Up on Muni Bonds

Huey and Artsdoctor, I am beginning to weaken in my position. But I remain troubled with the concept that (1) muni bond premium is not deductible in arriving at taxable income, and (2) deducting the muni bond premium against the total muni bond income on line 8b will reduce taxable income for some t...
by MarkNYC
Sat Aug 08, 2015 7:49 pm
Forum: Investing - Theory, News & General
Topic: Allan Roth Says Not to Load Up on Muni Bonds
Replies: 101
Views: 7962

Re: Allan Roth Says Not to Load Up on Muni Bonds

No, the premium amortization is not deducted anywhere on the return. Rather, it is done solely to reduce the amount reported on line 8b. And FWIW, TurboTax and TaxWise can handle such adjustments perfectly. Huey, The Government guideline you posted said: (1) the muni bond premium is not deductible ...
by MarkNYC
Sat Aug 08, 2015 7:28 pm
Forum: Investing - Theory, News & General
Topic: Allan Roth Says Not to Load Up on Muni Bonds
Replies: 101
Views: 7962

Re: Allan Roth Says Not to Load Up on Muni Bonds

Thanks Mark for your reply. I use the following Government guideline: "If the bond yields tax-exempt interest, you must amortize the premium. This amortized amount is not deductible in determining taxable income. However, each year you must reduce your basis in the bond (and tax-exempt interes...
by MarkNYC
Sat Aug 08, 2015 6:44 pm
Forum: Investing - Theory, News & General
Topic: Allan Roth Says Not to Load Up on Muni Bonds
Replies: 101
Views: 7962

Re: Allan Roth Says Not to Load Up on Muni Bonds

Huey and Artsdoctor, I still disagree with your position, that the muni income on line 8b of the 1040 can be reduced by muni bond premium. Code Sec 171(a) states: "In the case of any bond... the following rules shall apply to the amortizable bond premium: (a) Taxable bonds-- In the case of a bo...
by MarkNYC
Fri Aug 07, 2015 8:28 pm
Forum: Investing - Theory, News & General
Topic: Allan Roth Says Not to Load Up on Muni Bonds
Replies: 101
Views: 7962

Re: Allan Roth Says Not to Load Up on Muni Bonds

Lastly, muni income is counted in modifying your AGI for Medicare premium purposes so if you don't amortize even in-state bonds on your tax return, you can be penalized by needlessly increasing your Medicare premiums. This is a mistake I've even seen accountants make because they don't see the rami...
by MarkNYC
Thu Aug 06, 2015 7:08 pm
Forum: Personal Finance (Not Investing)
Topic: Tax questions when selling a rental property
Replies: 24
Views: 1496

Re: Tax questions when selling a rental property

Why wouldn't it be 410-100 less any sales costs? I see some are advising on depreciation, but it sounds like mom was not sophisticated to clam depreciation to begin with, so why recapture it? IRS doesnt care if you depreciated it or not. As per IRS, it assumes it was depreciated and it needs to be ...
by MarkNYC
Sat Aug 01, 2015 8:13 pm
Forum: Personal Finance (Not Investing)
Topic: Hit with $10k tax bill from 2013, given 3 weeks to pay
Replies: 50
Views: 6069

Re: Hit with $10k tax bill from 2013, given 3 weeks to pay

Also, do not forget "First Time Penalty Abatement"! Little known IRC Section. This is huge if you have to pay! v The First Time Penalty Abatement Program (FTA) only applies to specific types of penalties. For individuals. it only applies to penalties for late filing and late payment. It a...
by MarkNYC
Wed Jul 29, 2015 1:56 pm
Forum: Personal Finance (Not Investing)
Topic: Donate $300,000 in traditional IRA to charity
Replies: 22
Views: 2048

Re: Donate $300,000 in traditional IRA to charity

A question about QCD whether in the past or future: Is the amount of AGI reduction is limited to the RMD amount or can it be much larger? For instance, if the RMD is $10,000 and one donates $300,000 in a QCD-manner, do they have to increase AGI by $290,000 and deduct it as an itemized deduction? A ...
by MarkNYC
Wed Jul 29, 2015 10:16 am
Forum: Personal Finance (Not Investing)
Topic: Donate $300,000 in traditional IRA to charity
Replies: 22
Views: 2048

Re: Donate $300,000 in traditional IRA to charity

Assuming you were itemizing before, the $X IRA distribution and $X donation combination will leave your *taxable income* unchanged but will increase your AGI by $X. The increase in your AGI could create many indirect tax issues (and related issues) for you: 2) It could decrease your allowable deduc...
by MarkNYC
Sun Jul 26, 2015 9:32 pm
Forum: Personal Finance (Not Investing)
Topic: Unequal estimated tax payments
Replies: 27
Views: 2157

Re: Unequal estimated tax payments

When computing quarterly estimated tax payments, income on a K-1 is considered earned evenly throughout the year, unless you receive information from the entity indicating uneven income. The income is taxable to the LLC member when earned by the entity, not when the cash is distributed to the indivi...
by MarkNYC
Wed Jul 22, 2015 3:51 pm
Forum: Personal Consumer Issues
Topic: How to pay taxes on blog income?
Replies: 53
Views: 3809

Re: How to pay taxes on blog income?

How about folks who want to maximize a retirement plan contribution so they don't report expenses and increase their profit. Might pay a little more SS is the downside or perhaps that's what they want so they get SS quarters they need. There are lots of angles. That's why filing a Sched C with no e...
by MarkNYC
Wed Jul 22, 2015 2:12 pm
Forum: Personal Consumer Issues
Topic: How to pay taxes on blog income?
Replies: 53
Views: 3809

Re: How to pay taxes on blog income?

How about folks who want to maximize a retirement plan contribution so they don't report expenses and increase their profit. Might pay a little more SS is the downside or perhaps that's what they want so they get SS quarters they need. There are lots of angles. That's why filing a Sched C with no e...
by MarkNYC
Wed Jul 22, 2015 2:10 pm
Forum: Personal Consumer Issues
Topic: How to pay taxes on blog income?
Replies: 53
Views: 3809

Re: How to pay taxes on blog income?

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by MarkNYC
Wed Jul 22, 2015 1:27 pm
Forum: Personal Consumer Issues
Topic: How to pay taxes on blog income?
Replies: 53
Views: 3809

Re: How to pay taxes on blog income?

Not reporting all your expenses is tax fraud just as much as not reporting all your income. As a general statement, this is not true. Certain expenses are "allowed" as a deduction, not "required" to be deducted. Omitting an allowable expense deduction will generally increase tax...
by MarkNYC
Wed Jul 22, 2015 12:24 pm
Forum: Personal Consumer Issues
Topic: How to pay taxes on blog income?
Replies: 53
Views: 3809

Re: How to pay taxes on blog income?

I will be a "sole proprietor" and file taxes under my Social Security number. I am wondering how I could demonstrate to the IRS the amount of my income in the absence of 1099 forms. When I was earning money as a sole proprietor and filing under Schedule C, my income far exceeded the 1099s...
by MarkNYC
Tue Jul 21, 2015 12:29 pm
Forum: Personal Finance (Not Investing)
Topic: Getting Taxed twice by states - please help
Replies: 12
Views: 1569

Re: Getting Taxed twice by states - please help

Whether the OP remained domiciled in VA 4 or 5 years after leaving it depends on all the relevant facts, including intent. No one factor is determinative, but the burden of proof for a change of domicile lies with the taxpayer. It seems that VA has already filed a 2011 resident statutory tax return ...
by MarkNYC
Thu Jul 09, 2015 4:50 pm
Forum: Personal Finance (Not Investing)
Topic: 2013 QCDs
Replies: 7
Views: 457

Re: 2013 QCDs

Has anyone else had any issues with the IRS regarding your 2013 QCDs? I just received a letter from them stating I owe $1,442 on my 2013 taxes. In reviewing their numbers I've determine they haven't excluded my QCDs from my taxable income. My TurboTax hard copy looks good, but I'm wondering if this...
by MarkNYC
Fri Jul 03, 2015 9:19 pm
Forum: Personal Finance (Not Investing)
Topic: Getting Married and Living in Separate States
Replies: 10
Views: 2039

Re: Getting Married and Living in Separate States

Since you live in different states, once married you would be allowed to file a "joint" federal tax return and separate state returns. You would file a full-year resident "married separate" OR return, and he would file a NY resident "married separate" return, or he may ...
by MarkNYC
Thu Jul 02, 2015 12:28 pm
Forum: Personal Finance (Not Investing)
Topic: Snow Bird Question [State Residency Requirements]
Replies: 54
Views: 5849

Re: Snow Bird Question [State Residency Requirements]

Does mailing address trump everything else? I was beginning to think that as well, but now it seems as if real property and/or business ownership trumps all. From CA's Publication 1031, Guideline on Residency: "No one factor is determinative. Consider all the facts of your particular situation...
by MarkNYC
Thu Jul 02, 2015 8:07 am
Forum: Personal Finance (Not Investing)
Topic: Snow Bird Question [State Residency Requirements]
Replies: 54
Views: 5849

Re: Snow Bird Question [State Residency Requirements]

If CA had the 183 day rule, the husband would be considered a statutory resident and the wife would not. Ok, great. Now if the husband is declared a CA resident and the wife is not, does the couple (married filing jointly) have to pay CA state income tax or not? His income would be subject to CA ta...
by MarkNYC
Wed Jul 01, 2015 7:41 pm
Forum: Personal Finance (Not Investing)
Topic: Snow Bird Question [State Residency Requirements]
Replies: 54
Views: 5849

Re: Snow Bird Question [State Residency Requirements]

Question on the 183 day rule. Let's say you are married filing jointly. Let's say you trying to stay in California for less than 183 days. If the husband stays in California for 190 days and the wife stays in California for 170 days, does that count as staying less than 183 days? The average is les...
by MarkNYC
Tue Jun 09, 2015 9:30 pm
Forum: Personal Finance (Not Investing)
Topic: IRS Notice regarding home sale in 2013
Replies: 20
Views: 2764

Re: IRS Notice regarding home sale in 2013

These types of situations should reinforce the message that, if you receive a 1099 showing income or sales proceeds, even if you believe there should be no income, or no tax on the income, you should consider carefully whether leaving the item off your tax return is likely to result in a computer-ge...
by MarkNYC
Sun Jun 07, 2015 8:13 pm
Forum: Personal Finance (Not Investing)
Topic: Avoiding form 709
Replies: 2
Views: 574

Re: Avoiding form 709

I Googled gift limit joint account , and found the following at: Gift Tax Returns: What You Need To Know : When married couples use the annual exclusion to gift split, does it matter who signs the checks if the funds are coming out of a joint account? Adam Toft, a reader, recently sent me this ques...
by MarkNYC
Sat May 30, 2015 3:49 pm
Forum: Personal Finance (Not Investing)
Topic: How to Estimate Nonresident Taxes in Multiple States
Replies: 3
Views: 395

Re: How to Estimate Nonresident Taxes in Multiple States

I had a bad experience with Turbotax doing my 2014 taxes. Turbotax calculated a number for the nonresident state that made no sense to me. So I downloaded the state tax bulletin and worked through it myself. It showed 0 tax due. Turbotax said I owed thousands. So I called the State and went through...
by MarkNYC
Wed May 27, 2015 4:51 pm
Forum: Personal Finance (Not Investing)
Topic: IRS Transcript page hacked
Replies: 23
Views: 1659

Re: IRS Data Breach Announced Today

Wife's SS#s was used on a fraudulent claim last year. Now she requires a PIN to file. But you have to be a victim of ID theft before you can get a PIN to file. Hopefully we will soon get to the point where you can get a PIN either way. You don't actually have to be a victim of identity theft to obt...
by MarkNYC
Thu May 21, 2015 12:30 pm
Forum: Personal Finance (Not Investing)
Topic: What actually happens when you overcontribute to your Roth IRA in a year?
Replies: 1
Views: 389

Re: What actually happens when you overcontribute to your Roth IRA in a year?

A contribution to a Roth IRA may not be allowed if you do not have enough compensation or if your modified AGI is too high for the year. If an excess contribution is not withdrawn by the due date of the tax return, there is a 6% tax on the excess contribution. The 6% applies for the year of the cont...
by MarkNYC
Sat May 16, 2015 7:29 pm
Forum: Personal Finance (Not Investing)
Topic: Letter from IRS (I think they are wrong)
Replies: 23
Views: 3434

Re: Letter from IRS (I think they are wrong)

...On the Social Security 1099, it explictly states that copies of the Social Security 1099's are not to be returned to the IRS. So I did not return the 1099's. And the IRS did not think that the withholdings occurred. I called the IRS and after a conversation of about 20 minutes, the agent agreed ...
by MarkNYC
Tue May 12, 2015 4:05 pm
Forum: Investing - Help with Personal Investments
Topic: Trust help received K-1 but no cash
Replies: 50
Views: 6509

Re: Trust help received K-1 but no cash

OK, I misrepresented for simplicity but now need to clarify ; I'm in the process of finding another accountant and have not broached this with the guy I have now. Meanwhile, I've been looking for advice online here and elsewhere and just got a direct answer, which I was trying to corroborate elsewh...
by MarkNYC
Wed Apr 22, 2015 9:16 pm
Forum: Personal Finance (Not Investing)
Topic: Do I Need to Amend My Taxes if No Change in Tax Liability?
Replies: 28
Views: 3877

Re: Do I Need to Amend My Taxes if No Change in Tax Liabilit

So, whether or not a taxpayer files an amended return, if the IRS discovers an unpaid tax obligation, it will assess penalties and interest for nonpayment or late payment. The IRS will charge interest on any additional tax due on an amended return, or resulting from a tax assessment for unreported ...
by MarkNYC
Thu Apr 16, 2015 8:52 am
Forum: Personal Finance (Not Investing)
Topic: Amending tax return
Replies: 17
Views: 1417

Re: Amending tax return

MarkS wrote: The late payment penalty is no more than 25% of the additional tax due... Interest would probably be about 7% per annum

Late payment penalties do not apply in this situation, and the interest rate the IRS currently charges on tax underpayments is 3%.
by MarkNYC
Thu Apr 16, 2015 8:40 am
Forum: Personal Finance (Not Investing)
Topic: Amending tax return
Replies: 17
Views: 1417

Re: Amending tax return

If you do owe tax they can add interest and late penalties and transform a few dollars into thousands. L. This cannot happen, for 3 reasons: 1. If the IRS matching program sends a tax assessment for unreported income, it will happen about 15-18 months after filing the return. 2. The IRS currently c...
by MarkNYC
Fri Apr 03, 2015 8:23 am
Forum: Personal Finance (Not Investing)
Topic: IRS makes Tax Error - Wrong Invoice - How to Fix?
Replies: 15
Views: 1608

Re: IRS makes Tax Error - Wrong Invoice - How to Fix?

This is Part 2 on TurboTax Error. Now it seems IRS also made an Error. https://www.bogleheads.org/forum/viewtopic.php?f=2&t=162166 The IRS invoice we received stated that $12,978 in Vanguard taxable dividends was missing from our 2013 return. This is correct and we verified it with our Vanguard...
by MarkNYC
Thu Apr 02, 2015 11:40 am
Forum: Personal Finance (Not Investing)
Topic: IRS makes Tax Error - Wrong Invoice - How to Fix?
Replies: 15
Views: 1608

Re: IRS makes Tax Error - Wrong Invoice - How to Fix?

One big item on the IRS bill which nobody has mentioned yet: the "substantial tax understatement penalty" of $3,962. Basically, the IRS says that small mistakes (like leaving a small amount of dividends off your return) are more understandable than big ones (like omitting $13K of dividend...
by MarkNYC
Thu Apr 02, 2015 11:26 am
Forum: Personal Finance (Not Investing)
Topic: IRS makes Tax Error - Wrong Invoice - How to Fix?
Replies: 15
Views: 1608

Re: IRS makes Tax Error - Wrong Invoice - How to Fix?

It is difficult to determine the nature of the IRS calculation error without viewing various items on the tax return. However, on the additional taxable income of $13,575 the IRS' additional tax is $5,447 (40%) vs your calculation of $3,956 (29%). This suggests you may be paying AMT, so out of curio...
by MarkNYC
Wed Apr 01, 2015 7:41 pm
Forum: Personal Finance (Not Investing)
Topic: Multi-state tax puzzle
Replies: 25
Views: 1414

Re: Multi-state tax puzzle

It would be easier just to have a form letter drafted to respond to any state notices. Easier, yes; effective, probably not. If a state receives a copy of a 1099, or W-2, or K-1 that indicates you received income sourced to that state, sending the state a form letter that states differently will be...
by MarkNYC
Wed Apr 01, 2015 6:19 pm
Forum: Personal Finance (Not Investing)
Topic: Multi-state tax puzzle
Replies: 25
Views: 1414

Re: Multi-state tax puzzle

But again, the question remains, how would one determine filing requirements across all 50 states?? You should not have to file a tax return in (and pay tax to) a nonresident state if you did not perform services in the state. For compliance purposes, you should check the various 1099-MISC forms. W...
by MarkNYC
Wed Apr 01, 2015 7:57 am
Forum: Personal Finance (Not Investing)
Topic: Quick NY Tax Question
Replies: 8
Views: 646

Re: Quick NY Tax Question

Edit.
by MarkNYC
Thu Mar 26, 2015 5:21 pm
Forum: Investing - Help with Personal Investments
Topic: What would you do with 1.25 million dollars for 1 year?
Replies: 39
Views: 4161

Re: What would you do with 1.25 million dollars for 1 year?

With incomes over $1M some of the safe harbors do not apply, e.g. in California no safe harbor amount... Thanks for this - I am going to look into. Was with tax accountant on Tuesday and he assured me that as long as we follow safe harbor, we will be fine. If there is state income tax due, then jus...
by MarkNYC
Tue Mar 24, 2015 12:01 pm
Forum: Personal Finance (Not Investing)
Topic: Best tools to understand the AMT?
Replies: 14
Views: 1556

Re: Best tools to understand the AMT?

.................................. Yes, as I noted before, my AMT marginal tax rate would have been 53.8% in 2014. ............................ Do you understand why it is that high? I was under the impression that it should be the basic 26/28% rates increased by 25% (for the exemption phaseout) so...
by MarkNYC
Fri Mar 20, 2015 3:15 pm
Forum: Personal Finance (Not Investing)
Topic: Received Confusing IRS Letter
Replies: 8
Views: 1510

Re: Received Confusing IRS Letter

Here's my theory. Something in the IRS computers was looking for Form 1116 to substantiate the foreign tax credit on the tax return, and in the absence of Form 1116, the credit was reduced to zero, causing a potential credit carryover. Then the computer recognized that no Form 1116 was needed since ...
by MarkNYC
Tue Mar 17, 2015 9:14 pm
Forum: Investing - Help with Personal Investments
Topic: Better to file taxes separately if married?
Replies: 23
Views: 2471

Re: Better to file taxes separately if married?

What about when saving tax deferred, or in a roth. Spouse one makes $350k, spouse two makes $60k, Spouse two is saving at the tax deferred max, $22,500. and looking to put more money away tax deferred or at least let it grow tax free). Would it make sense to MFS, qualifying spouse two to at least p...
by MarkNYC
Tue Mar 17, 2015 9:08 pm
Forum: Personal Finance (Not Investing)
Topic: Distribution of RMD when trust is Inherited IRA beneficiary
Replies: 3
Views: 526

Re: Distribution of RMD when trust is Inherited IRA benefici

Reported on line 5 of the K-1, as "Other portfolio and nonbusiness income."
by MarkNYC
Fri Mar 13, 2015 12:41 pm
Forum: Personal Finance (Not Investing)
Topic: Rental properties
Replies: 25
Views: 3338

Re: Rental properties

For those who own rental properties jointly with their spouse, I'm curious how many (if any?) report the income and expenses properly on Federal Schedule E. A rental property owned jointly by spouses is considered by the IRS to be a partnership requiring the filing of partnership tax return Form 106...
by MarkNYC
Thu Mar 12, 2015 6:33 pm
Forum: Personal Finance (Not Investing)
Topic: How do I calculate depreciation/basis for rental?
Replies: 38
Views: 2461

Re: How do I calculate depreciation/basis for rental?

If a certain amount of depreciation was "allowable" during the rental years, say $75K, and zero depreciation was taken, the adjusted basis for calculating gain or loss will include a reduction for the $75K depreciation allowable. However, assuming the taxpayer has records to show no deprec...
by MarkNYC
Thu Mar 05, 2015 9:27 pm
Forum: Investing - Help with Personal Investments
Topic: S. Corp Salary Amount and Retirement Contributions
Replies: 41
Views: 3172

Re: S. Corp Salary Amount and Retirement Contributions

--> I understand I do not have to pay interest to the IRS on taxes that are owed if I get an extension- is that correct? <-- That is incorrect. You will have to pay interest and a Failure to Pay penalty on any amount you owe. Currently he effective interest rate (sum of FTP penalty and interest) is...
by MarkNYC
Thu Mar 05, 2015 6:03 pm
Forum: Personal Finance (Not Investing)
Topic: How are Carry forward Capital Losses handled in Divorce?
Replies: 10
Views: 565

Re: How are Carry forward Capital Losses handled in Divorce?

See page 38 of pub 544 Joint and separate returns. On a joint return, the capital gains and losses of spouses are figured as the gains and losses of an individual. If you are married and filing a separate return, your yearly capital loss deduction is limited to $1,500. Neither you nor your spouse c...
by MarkNYC
Thu Mar 05, 2015 4:01 pm
Forum: Personal Finance (Not Investing)
Topic: Rapid amending of tax return
Replies: 14
Views: 930

Re: Rapid amending of tax return

We once got hit with a penalty for amending the return after April 15th when we owed additional taxes. It was due to a late arriving 1099 for merchandise received for contests won at work by my wife. It wasn't a lot of money, but they still hit us with a penalty. In a situation like that, where you...
by MarkNYC
Wed Mar 04, 2015 4:14 pm
Forum: Personal Finance (Not Investing)
Topic: Step-up in basis for inherited assets - Question
Replies: 8
Views: 784

Re: Step-up in basis for inherited assets - Question

For stocks and bonds, the FMV on the date of death is the mean between the highest and lowest selling price quoted on the valuation date (usually day of death). For a mutual fund, where only the closing price is available, the FMV is the mean between the closing price on the valuation date and on th...
by MarkNYC
Wed Mar 04, 2015 1:09 pm
Forum: Investing - Help with Personal Investments
Topic: Estate - Stepped-Up Value of House
Replies: 6
Views: 750

Re: Estate - Stepped-Up Value of House

The rules are set up so that you do not benefit from both the step up in basis AND the full 500k exclusion. Should you pass first, the basis is stepped up to DOD value (lets assume 800k) which will leave little gain, but the exclusion for your spouse is 250k, not 500k. Essentially, both spouses mus...

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