Search found 1169 matches

by MarkNYC
Fri Oct 13, 2017 7:58 pm
Forum: Investing - Help with Personal Investments
Topic: pay taxes from long term gains on a taxable account
Replies: 18
Views: 1328

Re: pay taxes from long term gains on a taxable account

1040-ES is very easy to use. It can be done online , only a couple pages with minimal info. The other option is to increase withholding on your W4. Don't forget state taxes if that's an issue for you too. ok! wow! I walked through the steps.. and does look easy! thanks! since I only made this money...
by MarkNYC
Fri Oct 13, 2017 4:14 pm
Forum: Personal Finance (Not Investing)
Topic: Does IRS have equivalent of credit freeze?
Replies: 20
Views: 1426

Re: Does IRS have equivalent of credit freeze?

We are in the same boat. This is an interesting idea. When you say incomplete are you suggesting you file a return based on the information you have as of January 26? And then once all W2s,1099s, other information are in your hand you amend it? I haven't thought about what I might put on an early r...
by MarkNYC
Wed Oct 11, 2017 7:38 pm
Forum: Personal Finance (Not Investing)
Topic: Tax issue: Made a mistake on Inherited IRA RMDs for five years
Replies: 38
Views: 2767

Re: Tax issue: Made a mistake on Inherited IRA RMDs for five years

The IRA custodians are supposed to calculate the official RMD each year and tell the account holder what it is each January. Did your wife ever get a notice for any of the years? It could even have been part of the year-end statement. Then you would have seen that you were planning to withdraw a di...
by MarkNYC
Wed Oct 11, 2017 7:10 pm
Forum: Personal Finance (Not Investing)
Topic: Tax issue: Made a mistake on Inherited IRA RMDs for five years
Replies: 38
Views: 2767

Re: Tax issue: Made a mistake on Inherited IRA RMDs for five years

The IRA custodians are supposed to calculate the official RMD each year and tell the account holder what it is each January . Did your wife ever get a notice for any of the years? That was my question. I know VG does this for you. For IRA owners subject to RMDs, the custodian must send the account ...
by MarkNYC
Thu Sep 28, 2017 4:43 pm
Forum: Personal Finance (Not Investing)
Topic: Accidentally Underpaid Income Taxes – Please Advise
Replies: 8
Views: 775

Re: Accidentally Underpaid Income Taxes – Please Advise

If you file and pay the $6K federal tax on Oct 15th, you will owe interest from April 15th at 4% annually, or about $120. If the additional $6K is less than 10% of your total federal tax, there will be no late-payment penalty, only interest. If more than 10% of total tax, you will owe the late-payme...
by MarkNYC
Tue Sep 26, 2017 8:32 pm
Forum: Personal Finance (Not Investing)
Topic: Taxes - parents receiving 1099-Misc for minor son’s earnings
Replies: 16
Views: 1150

Re: Taxes - parents receiving 1099-Misc for minor son’s earnings

This is clearly nominee income. The most practical way to report is to file a schedule C listing the 1099-MISC income, then list the same amount as "other expenses" with the description "nominee" and list the SSN of the correct recipient of the income, resulting in no gain or loss on the Schedule C....
by MarkNYC
Fri Sep 15, 2017 4:10 pm
Forum: Personal Finance (Not Investing)
Topic: Selling Mom's condo and capital gains tax after a multi-year absence
Replies: 14
Views: 1327

Re: Selling Mom's condo and capital gains tax after a multi-year absence

I don't think your understanding is correct. The 2-year residency requirement never drops to 1 year. However, if, during the 5-year period prior to sale the taxpayer's physical or mental incapacity requires that he/she live in a healthcare facility, then the period lived in the healthcare facility ...
by MarkNYC
Fri Sep 15, 2017 3:20 pm
Forum: Personal Finance (Not Investing)
Topic: Selling Mom's condo and capital gains tax after a multi-year absence
Replies: 14
Views: 1327

Re: Selling Mom's condo and capital gains tax after a multi-year absence

I don't think your understanding is correct. The 2-year residency requirement never drops to 1 year. However, if, during the 5-year period prior to sale the taxpayer's physical or mental incapacity requires that he/she live in a healthcare facility, then the period lived in the healthcare facility w...
by MarkNYC
Thu Sep 14, 2017 12:06 pm
Forum: Personal Finance (Not Investing)
Topic: 3Q2017 Estimated taxes are due 15 Sep 2017
Replies: 14
Views: 827

Re: 3Q2017 Estimated taxes are due 15 Sep 2017

I've never paid estimated taxes, even when TurboTax tells me to based on my prior year tax return filing. And I've never been assessed any penalties as a result. TurboTax and other tax programs will generate estimated taxes for the following year based on various default options that are set. The r...
by MarkNYC
Thu Sep 14, 2017 11:56 am
Forum: Personal Finance (Not Investing)
Topic: K-1's and taxes
Replies: 10
Views: 653

Re: K-1's and taxes

I have an MLP with a K1. Pretty simple to log in TaxAct, but you must wait forever to file. Going to dump it this year and take a loss just to avoid the hassle. The major tax-reporting hassle comes in the year of sale. The brokerage 1099 will report the gain based on the original cost, but this wil...
by MarkNYC
Mon Sep 11, 2017 1:53 pm
Forum: Personal Finance (Not Investing)
Topic: Equifax fiasco - how can we protect ourselves from potential fraudulent tax returns filed on our behalf?
Replies: 31
Views: 3730

Re: Equifax fiasco - how can we protect ourselves from potential fraudulent tax returns filed on our behalf?

Aside from the standard I'D protection, arrange withholding/estimated taxes so you get a minimal refund. You could file early before you get all of your documents and then file an amended return, but I don't know if it would be worth the hassle. From what I understand the fraud is not sniping your ...
by MarkNYC
Fri Sep 08, 2017 8:33 pm
Forum: Personal Finance (Not Investing)
Topic: Paying Taxes Quarterly
Replies: 21
Views: 2125

Re: Paying Taxes Quarterly

To avoid the penalty, it is only necessary to pay 90% of the actual tax, not 100% - assuming you are not paying amounts based on your prior year tax. So meeting the 90% quarterly on an annualized average? Let's say for whatever reason when December comes I realize I wont need 10K for the final quar...
by MarkNYC
Fri Sep 08, 2017 8:16 pm
Forum: Personal Finance (Not Investing)
Topic: Paying Taxes Quarterly
Replies: 21
Views: 2125

Re: Paying Taxes Quarterly

No, that method won't work. It should be done this way: If your income in the first quarter is $10K, you would annualize that out to $40K for the year. Subtracting the $10,400 for exemption and standard deduction would give you taxable income of $29,600. If tax on that amount is $4,000, you would o...
by MarkNYC
Fri Sep 08, 2017 8:01 pm
Forum: Personal Finance (Not Investing)
Topic: Paying Taxes Quarterly
Replies: 21
Views: 2125

Re: Paying Taxes Quarterly

No, that method won't work. It should be done this way: If your income in the first quarter is $10K, you would annualize that out to $40K for the year. Subtracting the $10,400 for exemption and standard deduction would give you taxable income of $29,600. If tax on that amount is $4,000, you would ow...
by MarkNYC
Sun Aug 27, 2017 9:38 pm
Forum: Personal Finance (Not Investing)
Topic: IRS CP2000 Tax Bill Letter - Please Help
Replies: 32
Views: 2067

Re: IRS CP2000 Tax Bill Letter - Please Help

I opened the mailbox the other morning to find a letter from the IRS. It's a CP2000 stating I owe $5,000+change(including penalty+interest) from 2015. What type of penalty was listed, and how much is it in relation to the additional tax? In the vast majority of cases, a CP2000 letter that results i...
by MarkNYC
Fri Aug 25, 2017 12:59 pm
Forum: Personal Consumer Issues
Topic: Tax Implications of Selling Personal Residence
Replies: 11
Views: 866

Re: Tax Implications of Selling Personal Residence

You do need to report it, or you'll get a letter from the IRS Automated Underreporting system, like I did :(. I did not receive a 1099 and I knew I was well under the $500K limit for a married couple, so didn't report it. Got the letter... In your case, a 1099-S would have been issued for the sale....
by MarkNYC
Fri Aug 25, 2017 12:32 pm
Forum: Personal Consumer Issues
Topic: Tax Implications of Selling Personal Residence
Replies: 11
Views: 866

Re: Tax Implications of Selling Personal Residence

Note that if you deferred a gain when you sold your house a "generation" ago, that deferred gain reduces the basis of the house you recently sold. Sorry, that's incorrect and was repealed many years ago. Gill Gill, I believe pshonore is correct. In 1997 the law was repealed that allowed a gain on s...
by MarkNYC
Thu Aug 17, 2017 4:44 pm
Forum: Investing - Help with Personal Investments
Topic: Tax question about selling my house
Replies: 17
Views: 1514

Re: Tax question about selling my house

I didn't deduct depreciation while I rented it out so I am hoping it won't be affected. Sorry, you will pay "recapture" tax. Recapture is calculated on depreciation that was "allowed or allowable," according to Internal Revenue Code section 1250(b)(3). This means it doesn't matter if you took the d...
by MarkNYC
Wed Aug 16, 2017 9:47 am
Forum: Personal Finance (Not Investing)
Topic: Accountant liable for penalties?
Replies: 33
Views: 3439

Re: Accountant liable for penalties?

Update: My sister talked to the accountant, and he advised sending in the payment to stop the interest clock from running, and he is going to write a letter to the state explaining the situation and asking for a refund for the penalties. Sending in the payment now to stop the interest, and then req...
by MarkNYC
Tue Aug 15, 2017 2:46 pm
Forum: Personal Finance (Not Investing)
Topic: Accountant liable for penalties?
Replies: 33
Views: 3439

Re: Accountant liable for penalties?

How can you hold the accountant liable? He already told you last February that he wouldn't have time to look at it for several months. Now that he's looked at it and run the numbers, there is more money due. We were fine with him filing the extension, where the problem is is that he did not tell us...
by MarkNYC
Tue Aug 15, 2017 12:35 pm
Forum: Personal Finance (Not Investing)
Topic: Accountant liable for penalties?
Replies: 33
Views: 3439

Re: Accountant liable for penalties?

Regarding the IRS, if an extension was properly prepared and filed, there should only be the 1/2 % per month late-payment penalty if less than 90% of the tax was paid, and interest. Interest cannot be abated. For the penalty, you can call or write the IRS requesting penalty abatement due to "reasona...
by MarkNYC
Sun Aug 13, 2017 8:01 pm
Forum: Personal Finance (Not Investing)
Topic: Tax benefits when jointly owning home and how to take title.
Replies: 2
Views: 400

Re: Tax benefits when jointly owning home and how to take title.

If all 3 of you are listed as co-owners, then each person is entitled to take a deduction for real estate tax and mortgage interest to the extent that each person actually made the payments. The percentage of ownership doesn't matter. You can deduct mortgage interest on a principal residence and one...
by MarkNYC
Mon Aug 07, 2017 2:12 pm
Forum: Personal Finance (Not Investing)
Topic: Roth, Taxes and Mistakes
Replies: 41
Views: 4200

Re: Roth, Taxes and Mistakes

Without defending the actions of the CPA, I'm going to put some blame on the IRS for allowing the OP and other taxpayers to get into this situation. Here's why: I have never heard of the IRS notifying a taxpayer of an excess Roth IRA contribution. If it ever happens, it's rare, even though the IRS h...
by MarkNYC
Thu Aug 03, 2017 6:59 pm
Forum: Personal Finance (Not Investing)
Topic: Question on Form 8960, NIIT
Replies: 2
Views: 216

Re: Question on Form 8960, NIIT

The capital gain from the sale of the mutual fund would be subject to NIIT. If you are a nonpassive shareholder in an S Corp, the ordinary income from the business activity would not be subject to net investment income tax, nor would gain from sale of property used in the business, or gain from sale...
by MarkNYC
Mon Jul 31, 2017 11:24 am
Forum: Personal Finance (Not Investing)
Topic: 1031 Exchange
Replies: 20
Views: 1268

Re: 1031 Exchange

This article supports the idea that it now takes 10 years, not 5 years, to convert a rental property into a primary residence for tax sheltering: https://www.forbes.com/2010/01/26/capital-gains-tax-1031-vacation-home-personal-finance-robert-wood.html The language in the article is misleading. There...
by MarkNYC
Mon Jul 31, 2017 9:17 am
Forum: Personal Finance (Not Investing)
Topic: 1031 Exchange
Replies: 20
Views: 1268

Re: 1031 Exchange

When applying the principal residence exclusion, any gain attributable to depreciation will not be eligible for the exclusion. In addition, any gain attributable to "nonqualified use" will not be eligible for the exclusion. "Nonqualified use" generally means any period after Jan 1, 2009 when the pro...
by MarkNYC
Wed Jul 26, 2017 7:58 am
Forum: Personal Finance (Not Investing)
Topic: Taxes on capital gains
Replies: 11
Views: 1230

Re: Taxes on capital gains

The original question was not specifically about federal income tax, but rather the amount of gains "where tax is not required to be paid", so the potential for state tax should not be overlooked. For example, if the only income is $48K long-term gains, a NY State resident would owe zero federal tax...
by MarkNYC
Tue Jul 18, 2017 5:45 pm
Forum: Personal Finance (Not Investing)
Topic: Excess 401k Contribution / Correction 1099 Code P
Replies: 4
Views: 338

Re: Excess 401k Contribution / Correction 1099 Code P

The taxable earnings portion of the distribution, if any, should be shown in box 2a of the 1099-R.

The aggregate of all gross distribution amounts from non-IRA Forms 1099-R should be reported on line 16a.
by MarkNYC
Tue Jul 18, 2017 3:37 pm
Forum: Personal Finance (Not Investing)
Topic: Excess 401k Contribution / Correction 1099 Code P
Replies: 4
Views: 338

Re: Excess 401k Contribution / Correction 1099 Code P

I think you have it correct. The excess deferral (not the same as excess contribution) is always taxable in the year of deferral. The excess should be reported on the wage line 7 of your 2015 1040. Since the excess was distributed prior to 4/15 of the succeeding year, it is not taxable in the year d...
by MarkNYC
Thu Jul 13, 2017 6:55 pm
Forum: Personal Finance (Not Investing)
Topic: Selling Property With Two Houses / Capital Gains
Replies: 10
Views: 666

Re: Selling Property With Two Houses / Capital Gains

The "nonqualified use" provision of the principal residence exclusion law took effect Jan 1, 2009, brought about by too many taxpayers taking their long-term rental properties that had gone way up in value and moving in for 2 years then selling and excluding the entire gain, producing a tax result t...
by MarkNYC
Thu Jul 13, 2017 6:39 pm
Forum: Personal Finance (Not Investing)
Topic: Selling Property With Two Houses / Capital Gains
Replies: 10
Views: 666

Re: Selling Property With Two Houses / Capital Gains

Since there are two separate buildings, the transaction must be reported as two separate sales - sale of a rental property and sale of a principal residence. When calculating the gains, sales proceeds and basis must be allocated between the two properties under the same method used to determine dep...
by MarkNYC
Thu Jul 13, 2017 4:27 pm
Forum: Personal Finance (Not Investing)
Topic: Selling Property With Two Houses / Capital Gains
Replies: 10
Views: 666

Re: Selling Property With Two Houses / Capital Gains

Since there are two separate buildings, the transaction must be reported as two separate sales - sale of a rental property and sale of a principal residence. When calculating the gains, sales proceeds and basis must be allocated between the two properties under the same method used to determine depr...
by MarkNYC
Tue Jul 11, 2017 3:46 pm
Forum: Personal Finance (Not Investing)
Topic: Income tax preparation cost?
Replies: 32
Views: 2799

Re: Income tax preparation cost?

We had one W-2, a 1099 from my wife's pension, two 1099-INTs, my brokerage statement from TDAmeritrade ( I did some tax loss harvesting ), and three or four cash charitable contributions. That's about it. The only reason I didn't do it myself was because I had some long term cap gains that were exe...
by MarkNYC
Mon Jul 03, 2017 7:51 pm
Forum: Personal Finance (Not Investing)
Topic: Best way to dispute/correct IRS bill
Replies: 18
Views: 1812

Re: Best way to dispute/correct IRS bill

In this situation, I doubt that a phone call can resolve the matter, because I doubt the IRS phone representative can have the tax recalculated to properly take into account the qualified dividend portion of the unreported dividends. When dividends are left off the tax return, I think it's common fo...
by MarkNYC
Wed Jun 28, 2017 1:01 pm
Forum: Personal Finance (Not Investing)
Topic: Tax Liability on Selling Former Residence (Now Rental)
Replies: 14
Views: 1040

Re: Tax Liability on Selling Former Residence (Now Rental)

I'm going to disagree with Mule on this one, but I also don't agree with the sources provided by jimb. There are two issues. One is the effect depreciation has on adjusted basis. The other is how much of the gain upon sale attributable to depreciation is "recaptured" in calculating tax. Reg. 1.1016-...
by MarkNYC
Mon Jun 12, 2017 12:57 pm
Forum: Investing - Help with Personal Investments
Topic: How to fix several years of excess contributions to Roth IRA?
Replies: 26
Views: 2698

Re: How to fix several years of excess contributions to Roth IRA?

This situation is not so easy to fix. Let's assume excess Roth contributions of $5,500 per year for 7 years (2010-2016), for a total of $38.5K. Although I've never seen it done, I believe the proper corrective procedure would be as follows: First for 2016, prior to 10/15/17 the excess could either b...
by MarkNYC
Wed May 24, 2017 4:18 pm
Forum: Personal Finance (Not Investing)
Topic: Verifying IRS expectations on Inherited IRA
Replies: 20
Views: 1338

Re: Verifying IRS expectations on Inherited IRA

The IRA custodian must report annually to the IRS any IRA contributions and the account's year-end value, which is done on Form 5498. In addition, the IRA custodian must report other information to the IRA owner: (1) by Jan 31 of the following year, the account value as of the end of the year. (2) e...
by MarkNYC
Fri May 19, 2017 3:06 pm
Forum: Personal Finance (Not Investing)
Topic: IRS says I owe..I don't
Replies: 34
Views: 5687

Re: IRS says I owe..I don't

Based on what you wrote in the opening post, for both 2014 and 2015 the only non-blank lines of Form 8606 should be 1 6500. (Nondeductible contributions for year) 3 6500. (sum of lines 1 and 2) 5 6500. (line 3 minus line 4) 6 0. (traditional IRA value at end of year) 8 6500. (conversion to Roth IRA...
by MarkNYC
Thu May 18, 2017 12:50 pm
Forum: Personal Finance (Not Investing)
Topic: Ticklish Tax Puzzle
Replies: 4
Views: 959

Re: Ticklish Tax Puzzle

Did the taxpayer make an election on her 2015 tax return to "waive the carryback period"? (see carolinaman's post above). If not, then the 2015 NOL cannot be carried forward and deducted on the 2016 tax return. It must first be carried back to 2013, unless taxable income was zero for both ...
by MarkNYC
Wed May 03, 2017 9:46 pm
Forum: Personal Finance (Not Investing)
Topic: Tax on index options
Replies: 3
Views: 526

Re: Tax on index options

The net gain or loss from broad-based equity index options is taxed as a Sec 1256 contract, so that 60% of the gain/loss is taxed as long-term and 40% short term. The proceeds from the option sale will not show on the 1099B, but the annual net Sec 1256 gain or loss should show separately on the 1099...
by MarkNYC
Wed May 03, 2017 9:14 pm
Forum: Personal Finance (Not Investing)
Topic: Trusts taxes distributions
Replies: 22
Views: 2270

Re: Trusts taxes distributions

1. Assume a "non-grantor" trust has zero DNI and makes a purely discretionary distribution of $10,000 cash to a beneficiary. I assume that is not a taxable event and does not get listed on the tax return? 2. Again assume a $10,000 cash purely discretionary distribution. But (in this examp...
by MarkNYC
Sat Apr 29, 2017 4:25 pm
Forum: Personal Finance (Not Investing)
Topic: Forced to use carryover losses
Replies: 12
Views: 1318

Re: Forced to use carryover losses

I casually called them options, but they are technically restricted stock units. The tax treatment of Restricted Stock Units is not much different than nonqualified options. When Restricted Stock Units become "vested" (meaning you actually own them), the shares of stock are then issued to...
by MarkNYC
Sat Apr 29, 2017 2:16 pm
Forum: Personal Finance (Not Investing)
Topic: Forced to use carryover losses
Replies: 12
Views: 1318

Re: Forced to use carryover losses

I casually called them options, but they are technically restricted stock units. The tax treatment of Restricted Stock Units is not much different than nonqualified options. When Restricted Stock Units become "vested" (meaning you actually own them), the shares of stock are then issued to...
by MarkNYC
Sat Apr 29, 2017 8:53 am
Forum: Personal Finance (Not Investing)
Topic: Forced to use carryover losses
Replies: 12
Views: 1318

Re: Forced to use carryover losses

jdilla1107 wrote:This year my company is going through a sales process and I will get a significant amount of long term capital gain from exercising options.

Are you sure you will be realizing long-term capital gains? The exercise of company options usually generates ordinary income.
by MarkNYC
Wed Apr 26, 2017 10:58 am
Forum: Personal Finance (Not Investing)
Topic: IRS form 8606 Inherited IRA w/ basis
Replies: 5
Views: 622

Re: IRS form 8606 Inherited IRA w/ basis

You filed the form correctly. It should be in your name and SSN. It's possible that in some years a taxpayer might have to file two separate Forms 8606: one for various reasons for their own IRA, and one for an inherited IRA that has basis.
by MarkNYC
Sun Apr 23, 2017 3:45 pm
Forum: Personal Consumer Issues
Topic: Any golfers played Bandon Dunes on the Oregon coast?
Replies: 5
Views: 700

Re: Any golfers played Bandon Dunes on the Oregon coast?

My brothers and I went about 6 or 7 years ago. It is remote, but for serious golfers, it's fantastic. Great courses and a superbly-run facility. There is a good book about the origin of Bandon Dunes, called Dream Golf, which is worth reading beforehand. Bandon Dunes is an unforgettable golf experien...
by MarkNYC
Tue Apr 18, 2017 8:14 pm
Forum: Personal Finance (Not Investing)
Topic: Taxes- okay to just drop in the mail today??
Replies: 29
Views: 3564

Re: Taxes- okay to just drop in the mail today??

A properly prepared extension avoids a 5% per month late filing penalty (which maxes out at 25%). But if the full amount isn't paid when due, there is a 1/2 of 1% per month late payment penalty ... The federal late payment penalty of 1/2 of 1% per month only applies if less than 90% of the total ta...
by MarkNYC
Sat Apr 15, 2017 11:05 am
Forum: Personal Finance (Not Investing)
Topic: Wrong 1099-R issued!
Replies: 16
Views: 1426

Re: Wrong 1099-R issued!

I finally got around to doing my taxes and I realized my financial institution issued a wrong 1099_R. I did a Roth conversion but it lists the $5,500 as a taxable early withdraw. Box 7 is a 2, instead of a G. How easy is it get them to fix this mistake by the deadline? The 1099-R is not incorrect. ...
by MarkNYC
Fri Mar 31, 2017 6:45 pm
Forum: Personal Finance (Not Investing)
Topic: Tax question: K-1 Form 1041 cash inheritance
Replies: 5
Views: 766

Re: Tax question: K-1 Form 1041 cash inheritance

There's a good chance that the $16,000 income on the K-1 represents IRA or pension/401K income that was paid to the trust as beneficiary of the retirement plan, which the trust passed out to you as beneficiary of the trust. IRA/pension income is not subject to the Net Investment Income tax, so the n...
by MarkNYC
Thu Mar 30, 2017 12:01 pm
Forum: Personal Finance (Not Investing)
Topic: Refund from IRS was $500 more than it should have been.
Replies: 9
Views: 1634

Re: Refund from IRS was $500 more than it should have been.

I did my taxes with TaxAct and electronically filed through them. My refund was to be $495 and yesterday I received $995 from the IRS deposited into my bank account. Should I call the IRS and tell them of their error or will they catch the mistake and remove the extra $500 from my bank account on t...