Search found 1125 matches

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: 425

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: 551

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: 3125

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: 1182

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. :oops: How easy is it get them to fix this mistake by the deadline? The 1099-R is not inco...
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: 449

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: 1389

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...
by MarkNYC
Thu Mar 23, 2017 8:00 pm
Forum: Personal Finance (Not Investing)
Topic: To file or not - irrevocable trust
Replies: 4
Views: 403

Re: To file or not - irrevocable trust

You are correct. You have to file if the trust has gross income of $600 or more, or if you have any taxable income. See Section 6012(a)(4). The statute says "any," but "no matter how small" means the same thing as "any." It seems to me that these specific filing instru...
by MarkNYC
Sat Mar 18, 2017 6:30 pm
Forum: Personal Finance (Not Investing)
Topic: Tax treatment of partnership K1 (form 1065) expenses
Replies: 2
Views: 293

Re: Tax treatment of partnership K1 (form 1065) expenses

Portfolio deductions are considered a miscellaneous itemized deduction. Miscellaneous itemized deductions that do not exceed 2% of adjusted gross income are not deductible, and they cannot be carried forward to any future year. They are lost.
by MarkNYC
Thu Mar 16, 2017 1:16 pm
Forum: Personal Finance (Not Investing)
Topic: Amend Return - MFJ to MFS
Replies: 37
Views: 1744

Re: Amend Return - MFJ to MFS

Since 2008 the 1040 instructions have also said "Do not file more than one original return for the same year". It's in the section "How to avoid common mistakes". Yes, the article I linked above from the Procedurally Taxing blog (written by Keith Fogg , a tax law professor who p...
by MarkNYC
Wed Mar 15, 2017 6:49 pm
Forum: Personal Finance (Not Investing)
Topic: Amend Return - MFJ to MFS
Replies: 37
Views: 1744

Re: Amend Return - MFJ to MFS

Filing a superseding tax return is currently permitted for certain types of tax returns, but I don't believe that Form 1040 is one of them. If anyone knows of a provision in the code, or regulations, or IRS filing instructions that currently allows filing a "superseding return" for Form 10...
by MarkNYC
Wed Mar 15, 2017 4:35 pm
Forum: Personal Finance (Not Investing)
Topic: Amend Return - MFJ to MFS
Replies: 37
Views: 1744

Re: Amend Return - MFJ to MFS

... However, you can't amend to change from joint to separate. Treas. Reg. § 1.6013-1(a)(1): https://www.law.cornell.edu/cfr/text/26/1.6013-1. "For any taxable year with respect to which a joint return has been filed, separate returns shall not be made by the spouses after the time for filing ...
by MarkNYC
Sun Mar 12, 2017 8:37 pm
Forum: Personal Finance (Not Investing)
Topic: Taxation Across State Lines 1120S (New York / New Jersey)
Replies: 14
Views: 837

Re: Taxation Across State Lines 1120S (New York / New Jersey)

Ah, I see. I didn't know that's how they calculated the NY portion. I thought it was just on the wages, but I suppose this does make sense. In that case the benefit really does disappear. The 529 would have been the only only reason I could tell to have NY based income if I didn't absolutely need i...
by MarkNYC
Sun Mar 12, 2017 8:32 pm
Forum: Investing - Help with Personal Investments
Topic: Tax time UTMA/TurboTax and how to file a child's UTMA 1099-DIV. What do I do?
Replies: 22
Views: 774

Re: Tax time UTMA/TurboTax and how to file a child's UTMA 1099-DIV. What do I do?

We have a dependent child with a (very) low balance UTMA. We are in the 39% marginal bracket with an effective tax rate of 31%. I did our taxes using TurboTax and did not include the UTMA account (thinking that I should file the child's taxes separately since she only received $14.26 in ordinary di...
by MarkNYC
Sun Mar 12, 2017 7:11 pm
Forum: Personal Finance (Not Investing)
Topic: Taxation Across State Lines 1120S (New York / New Jersey)
Replies: 14
Views: 837

Re: Taxation Across State Lines 1120S (New York / New Jersey)

I still have about 50K of regular wages that are being taxed at about 1.4% higher rate in NY State (4.13 vs 5.55% Effective)... Therefore if I do contribute to a NY 529 plan, I should be able to reduce my NY Taxable gross income by about 20%. A NY resident can deduct a NY 529 Plan contribution dire...
by MarkNYC
Sun Mar 12, 2017 6:46 pm
Forum: Personal Finance (Not Investing)
Topic: Taxation Across State Lines 1120S (New York / New Jersey)
Replies: 14
Views: 837

Re: Taxation Across State Lines 1120S (New York / New Jersey)

I still have about 50K of regular wages that are being taxed at about 1.4% higher rate in NY State (4.13 vs 5.55% Effective)... Therefore if I do contribute to a NY 529 plan, I should be able to reduce my NY Taxable gross income by about 20%. A NY resident can deduct a NY 529 Plan contribution dire...
by MarkNYC
Sat Mar 11, 2017 2:00 pm
Forum: Personal Finance (Not Investing)
Topic: Tax Question on Refund from the State
Replies: 16
Views: 1122

Re: Tax Question on Refund from the State

When the unexpected refund is a round number like $3,500, my first guess would be that the OP made a $3,500 state estimated tax payment or extension payment that was not listed on the tax return. In that situation, the federal return is not affected and the state tax refund is not taxable since the ...
by MarkNYC
Fri Mar 10, 2017 9:59 pm
Forum: Personal Finance (Not Investing)
Topic: Tax Question on Refund from the State
Replies: 16
Views: 1122

Re: Tax Question on Refund from the State

Thank you all. It's going to be taxable, and it looks like I'll declare it on my 2017 federal taxes. As an aside, it was the state the identified the issue. I knew that I overpaid but I figured that I would have to file an amended return. Are your sure it will be taxable? What was the specific erro...
by MarkNYC
Fri Mar 10, 2017 6:04 pm
Forum: Investing - Theory, News & General
Topic: When is tax due on IRA distribution?
Replies: 14
Views: 831

Re: When is tax due on IRA distribution?

How are you going to withhold at the end of the year if you aren't going to have any more income for the year? In December I figured that our scant withholding was insufficient to avoid penalties for underpayment. Solution: Take an IRA distribution of about $3000 and withhold 80% for federal and 20...
by MarkNYC
Fri Mar 10, 2017 11:55 am
Forum: Personal Finance (Not Investing)
Topic: Taxation of Irrevocable Trust Income
Replies: 44
Views: 1890

Re: Taxation of Irrevocable Trust Income

Thanks for giving me the opportunity to think about these things once again. I've been away from the trust business for a few years! :happy Gill Is there a book available that discusses taxation of trusts that you can recommend for those who want to read about it? MarkNYC or bsteiner may be able to...
by MarkNYC
Thu Mar 09, 2017 4:20 pm
Forum: Investing - Help with Personal Investments
Topic: House: Pay Cash then Mortgage (Delayed Financing) - worth it?
Replies: 22
Views: 1666

Re: House: Pay Cash then Mortgage (Delayed Financing) - worth it?

There is another issue to consider. If the purchase of a principal or second residence is all cash and a mortgage is taken out within 90 days, the loan qualifies as acquisition debt and the interest is deductible up to $1million of debt. If the loan is taken out more than 90 days after purchase, the...
by MarkNYC
Wed Mar 08, 2017 9:18 pm
Forum: Personal Finance (Not Investing)
Topic: Taxation of Irrevocable Trust Income
Replies: 44
Views: 1890

Re: Taxation of Irrevocable Trust Income

The Trust document DOES require net income to be paid. So I guess allowing $9000 to accumulate (and be taxed at the Trusts's lower tax rate) can't happen. I see that there's an election to actually distribute some of all of the income by the end of the first week of March following the tax year in ...
by MarkNYC
Tue Mar 07, 2017 3:14 pm
Forum: Personal Finance (Not Investing)
Topic: Bypass Trust - should capital gains be distributed?
Replies: 16
Views: 830

Re: Bypass Trust - should capital gains be distributed?

Bruce, In this and similar situations, is it your view that discretionary distributions of principal automatically carry out any current-year capital gains to the beneficiary, or that capital gains are not included in Distributable Net Income (DNI), therefore the capital gains remain (taxable) in t...
by MarkNYC
Tue Mar 07, 2017 12:52 pm
Forum: Personal Finance (Not Investing)
Topic: Bypass Trust - should capital gains be distributed?
Replies: 16
Views: 830

Re: Bypass Trust - should capital gains be distributed?

... What if assets are distributed in kind? Do they retain the same stepped-up cost basis from when the trust was formed? ... Generally yes, except the trust can elect to treat the distributions as sales, in which case the trust will have capital gain and the recipient will have a new basis equal t...
by MarkNYC
Mon Mar 06, 2017 5:30 pm
Forum: Personal Finance (Not Investing)
Topic: Reporting Recharacterized Roth IRA to Traditional IRA across 2 tax years
Replies: 6
Views: 404

Re: Reporting Recharacterized Roth IRA to Traditional IRA across 2 tax years

Although the 2016 1099-R amount does not need to be reported on page one of the 2016 tax return, it should be reported in a statement attached to the tax return which explains the date and amount of the contribution and date and amount of the recharacterization. The statement should have been on th...
by MarkNYC
Sun Mar 05, 2017 10:24 pm
Forum: Personal Finance (Not Investing)
Topic: Reporting Recharacterized Roth IRA to Traditional IRA across 2 tax years
Replies: 6
Views: 404

Re: Reporting Recharacterized Roth IRA to Traditional IRA across 2 tax years

Although the 2016 1099-R amount does not need to be reported on page one of the 2016 tax return, it should be reported in a statement attached to the tax return which explains the date and amount of the contribution and date and amount of the recharacterization.
by MarkNYC
Sun Mar 05, 2017 7:34 pm
Forum: Investing - Help with Personal Investments
Topic: kiddie tax
Replies: 20
Views: 2127

Re: kiddie tax

Situation: I'm assisting a 22-year-old full-time student niece with Form 8615, but am stuck on line A involving who is a "custodial parent". Her parents divorced long ago, she lives in her own place (all year long), and had enough unearned income (from a deceased grandparent's trust) to p...
by MarkNYC
Sun Mar 05, 2017 6:59 pm
Forum: Personal Finance (Not Investing)
Topic: The Joys Of Tax Season! :(
Replies: 55
Views: 4284

Re: The Joys Of Tax Season! :(

I set a new record this year. Under 2 hours at a leisurely pace... But I haven't filed yet, I like to sit on the return and review it later to make sure all of the I's are dotted and the T's are crossed. I do the same, and I think this is good advice for those who prepare their own tax returns. Aft...
by MarkNYC
Fri Mar 03, 2017 6:07 pm
Forum: Personal Finance (Not Investing)
Topic: Tax Thoughts - Home Sale and Rental Sale in 2016
Replies: 5
Views: 571

Re: Tax Thoughts - Home Sale and Rental Sale in 2016

If a principal residence is sold prior to meeting the 2-year ownership and residency test, a reduced exclusion of the gain may be available if the sale was due to (1) a change of employment, (2) health reasons, or (3) other unforeseen circumstances. In this case, if the reduced exclusion applies to ...
by MarkNYC
Thu Mar 02, 2017 8:22 pm
Forum: Personal Finance (Not Investing)
Topic: State wages (box 16) blank on W-2
Replies: 12
Views: 912

Re: State wages (box 16) blank on W-2

What type of "one-time payment" did you receive in the calendar year after the year of retirement? Bonus, unused vacation pay, something else? It was payment of variable compensation (bonus) pro-rated for the amount of time I had worked the previous year. I talked with the dept. of revenu...
by MarkNYC
Thu Mar 02, 2017 6:11 pm
Forum: Investing - Help with Personal Investments
Topic: Roth Conversion 04/13/2013
Replies: 18
Views: 1025

Re: Roth Conversion 04/13/2013

Each conversion has it's own 5 year clock, but all such clocks end at age 59.5. So if you converted at 56.5, that conversion clock only runs 3 years before you are 59.5. Then it stops. That is why all conversion clocks stop at 59.5, EVEN IF the Roth is not yet qualified. A qualified Roth means that...
by MarkNYC
Thu Mar 02, 2017 5:00 pm
Forum: Investing - Help with Personal Investments
Topic: Roth Conversion 04/13/2013
Replies: 18
Views: 1025

Re: Roth Conversion 04/13/2013

It is only the year of the first conversion or contribution to a Roth that is significant. After it meets the 5-year rule, any other conversions or contributions to any Roth no longer have a time rule (but still have the age rule). The idea that each conversion has a 5-year "clock" means ...
by MarkNYC
Thu Mar 02, 2017 4:43 pm
Forum: Investing - Theory, News & General
Topic: Paul Kangas passed away
Replies: 23
Views: 3759

Re: Paul Kangas passed away

Yes, I remember him from NBR. Great broadcast voice, flawless delivery, yet somehow he seemed trustworthy and a nice guy to boot. Sad to hear of his passing. steve +1 on the voice and delivery and persona. I agree the voice and delivery were exceptional - clear, crisp, never a hesitation or stumble...
by MarkNYC
Thu Mar 02, 2017 3:40 pm
Forum: Personal Finance (Not Investing)
Topic: State wages (box 16) blank on W-2
Replies: 12
Views: 912

Re: State wages (box 16) blank on W-2

I retired in 2015. In 2016, I received a one-time payment related to my employment in 2015 and was sent a W-2 form in early February this year (2017). Everything looks right except that all the box 16's are blank. Previously, while working, my W-2's would have two state wages boxes, one for my stat...
by MarkNYC
Wed Mar 01, 2017 3:18 pm
Forum: Investing - Theory, News & General
Topic: ROTH IRA and April Deadline
Replies: 15
Views: 686

Re: ROTH IRA and April Deadline

A word of caution about last-minute IRA contributions. The law sets the tax return filing deadline (without extensions) as the last day for making an IRA contribution for the prior year, which this year is 4/18/17 for 2016. I recall a few years ago when 4/16 was the filing deadline for the year that...
by MarkNYC
Mon Feb 27, 2017 6:20 pm
Forum: Personal Finance (Not Investing)
Topic: IRS form 4506-T: missing 1099's
Replies: 2
Views: 236

Re: IRS form 4506-T: missing 1099's

The Form 4506-T instructions say you should contact the payer first if you need a copy of the 1099. But you don't necessarily need a copy of the 1099s. A transcript showing the income information from the 1099s may be sufficient. You can obtain this information by filing the 4506-T, checking box 8 f...
by MarkNYC
Sun Feb 26, 2017 7:00 pm
Forum: Personal Finance (Not Investing)
Topic: How to avoid paying penalty for getting too much of a refund?
Replies: 9
Views: 1151

Re: How to avoid paying penalty for getting too much of a refund?

I agree with others suggesting you wait. Assuming you do actually receive a $633 refund that you're not entitled to, if you file the amended return and IRS receives the repayment by April 18th, there will be no interest charged. If you file and repay by May 15th, the interest will be about $2. In an...
by MarkNYC
Fri Feb 24, 2017 4:30 pm
Forum: Personal Finance (Not Investing)
Topic: Filing For Extension?
Replies: 14
Views: 766

Re: Filing For Extension?

If a federal extension is filed and tax is due with the eventual filing of the tax return after April 15th (18th this year), the late payment penalty of 0.5% per month will be charged on the additional tax due unless there is reasonable cause for failure to pay enough tax by April 15th. The taxpayer...
by MarkNYC
Tue Feb 21, 2017 4:49 pm
Forum: Investing - Help with Personal Investments
Topic: Why no 1099-B for a C corp?
Replies: 4
Views: 304

Re: Why no 1099-B for a C corp?

Thanks for the reply Mark I don't see this language on my 1099-DIV (which also has 1099-B instructions, but no 1099-B). Are you saying that Vanguard does not have to supply a 1099-B for my C corp account? The Form 1099-B instructions provide various requirements and exceptions for when the form mus...
by MarkNYC
Tue Feb 21, 2017 3:47 pm
Forum: Investing - Help with Personal Investments
Topic: Why no 1099-B for a C corp?
Replies: 4
Views: 304

Re: Why no 1099-B for a C corp?

bumping my own thread After a few days I received a brief response from Vanguard - "we are researching your inquiry, please give us a month to review." !? I will call them of course. Anyone have insight? If you check the instructions to Form 1099-B, you'll see that brokers (see definition...
by MarkNYC
Fri Feb 17, 2017 5:50 pm
Forum: Personal Finance (Not Investing)
Topic: When the IRS won't take their money
Replies: 8
Views: 1151

Re: When the IRS won't take their money

The federal tax filing deadline for 2015 was Tuesday April 18th, 2016. Since April 15 was on Saturday, the due date moved to Monday the 17th, but the Washington DC Emancipation Day was observed on the 17th, so the due date was moved to the 18th. So your IRA contribution on April 18th was not late. T...
by MarkNYC
Mon Feb 13, 2017 9:35 pm
Forum: Personal Finance (Not Investing)
Topic: Vang.1099-DIV and Wisconsin tax on munis
Replies: 7
Views: 572

Re: Vang.1099-DIV and Wisconsin tax on munis

Yes, the total (annual) amount from VWIUX is reported in Box 10 of the 1099-DIV. But I don't get it. Why would this total amount be "dividends" rather than "interest"? And, does it make any difference (in terms of tax treatment or other) whether they are listed as "interest...
by MarkNYC
Mon Feb 13, 2017 7:39 pm
Forum: Personal Finance (Not Investing)
Topic: Small Retirement Distribution Without 1099-R
Replies: 9
Views: 350

Re: Small Retirement Distribution Without 1099-R

Since the MIL died in July and the check was paid in December, the income does not belong on your MIL's final year individual income tax return. It should be "other income" on her estate income tax return Form 1041, assuming such a tax return is required to be filed. Even though it was ac...
by MarkNYC
Mon Feb 13, 2017 7:01 pm
Forum: Personal Finance (Not Investing)
Topic: Small Retirement Distribution Without 1099-R
Replies: 9
Views: 350

Re: Small Retirement Distribution Without 1099-R

Since the MIL died in July and the check was paid in December, the income does not belong on your MIL's final year individual income tax return. It should be "other income" on her estate income tax return Form 1041, assuming such a tax return is required to be filed.
by MarkNYC
Sun Feb 12, 2017 11:00 pm
Forum: Personal Finance (Not Investing)
Topic: Legal Expenses Taken Against Settlement
Replies: 8
Views: 1075

Re: Legal Expenses Taken Against Settlement

The legal fees were paid periodically over the three-year course of the case right up to the settlement in mid-2016. According to the IRS, IRC § 62(a)(21) specifies an above the line-deduction for attorney fees and court costs associated with suits involving discrimination and whistleblower claims....
by MarkNYC
Sun Feb 12, 2017 9:09 pm
Forum: Personal Finance (Not Investing)
Topic: Broker withheld wrong amount from RMD, how do we report on taxes?
Replies: 17
Views: 1026

Re: Broker withheld wrong amount from RMD, how do we report on taxes?

I agree with spectec that obtaining a corrected 1099-R would be best. If that can't be done, here's what I would do: I would ask the broker to confirm that the extra payment was not paid as withholding, since there is no 1099 that reflects any additional withholding. If not withholding, and since t...
by MarkNYC
Sun Feb 12, 2017 8:41 pm
Forum: Personal Finance (Not Investing)
Topic: Broker withheld wrong amount from RMD, how do we report on taxes?
Replies: 17
Views: 1026

Re: Broker withheld wrong amount from RMD, how do we report on taxes?

Thanks for all the replies. This is pretty much what we thought of as well, since the funds came from the other account it's technically no longer withholding. It seems like claiming this as estimated taxes makes sense, and being prepared for the IRS to question this. The broker is Morgan Stanley (...
by MarkNYC
Sun Feb 12, 2017 8:19 pm
Forum: Personal Finance (Not Investing)
Topic: Broker withheld wrong amount from RMD, how do we report on taxes?
Replies: 17
Views: 1026

Re: Broker withheld wrong amount from RMD, how do we report on taxes?

I agree with spectec that obtaining a corrected 1099-R would be best. If that can't be done, here's what I would do: I would ask the broker to confirm that the extra payment was not paid as withholding, since there is no 1099 that reflects any additional withholding. If not withholding, and since th...
by MarkNYC
Sun Feb 12, 2017 7:09 pm
Forum: Personal Finance (Not Investing)
Topic: Legal Expenses Taken Against Settlement
Replies: 8
Views: 1075

Re: Legal Expenses Taken Against Settlement

The deduction of legal fees can be complicated. When legal fees related to a lawsuit are allowed as a deduction, they are generally deductible as a miscellaneous itemized deduction, subject to 2% of AGI. Sometimes, when the legal fees are associated with income from a trade or business, the deductio...
by MarkNYC
Tue Feb 07, 2017 3:00 pm
Forum: Personal Finance (Not Investing)
Topic: Form 2210 questions
Replies: 17
Views: 1341

Re: Form 2210 questions

If the instructions for a tax form lists conditions for which the form is to be filed, and those conditions are not met, then don't file the form. This is a good general rule. After all, why make your tax return more voluminous than it needs to be. There are, however, some situations where I think ...
by MarkNYC
Tue Feb 07, 2017 11:27 am
Forum: Investing - Help with Personal Investments
Topic: Tax Loss Harvesting--Carry Forward
Replies: 6
Views: 674

Re: Tax Loss Harvesting--Carry Forward

In 2015, wife and I had income of $10K, no schedule A. Therefore owe no taxes with standard deduction and exemptions. Also had capital loss of $4K. Even though we owed no money in taxes, $3000 (capital loss) was applied to $10,000 to lower our AGI to $7000. Did the $3000 have to be applied to 2015 ...

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