Eight 2019 taxes questions - could use some guidance

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Aguilar
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Joined: Fri Jan 24, 2020 11:01 pm

Eight 2019 taxes questions - could use some guidance

Post by Aguilar » Tue May 26, 2020 2:21 pm

I have some questions I could use help with as I complete my wife and my's 2019 taxes. Would really appreciate any advice here from the tax experts on the forum.

1. I have a form 1099-B from eTrade regarding some company stock that vested and I sold in 2019. In the Totals Summary in the 1099-B, the form says under Short term gains or losses that I have $36k in proceeds.This # is also listed under Realized gain or loss. This info is labeled Box B (basis not reported to IRS). Do I need to file this info? the 1099-B says Report on Form 8949, PART I but I've never seen a form like this before. It doesn't look like a typical 1099-B. My first year with eTrade. I do know my employer sold some of the vested shares to cover taxes before I got the rest of the shares in each vested allotment.

2. I paid $475 in foreign tax for international mutual funds in 2019. My wife didn't pay any. I read we don't need to file form 1116 but it sounds like it's better to do so, so I gave it a shot. The info for the 2 international mutual funds is correct in TaxAct, but there's also a section already populated for my Total Stock Market Admiral account, and it says $635 taxes withheld at the source on dividends in U.S. dollars. Is this info on VTSAX supposed to be filed? I thought only intl funds with foreign taxes paid would be included in this form.

3. TaxAct says I owe Net Investment Income tax of $602. First time seeing this. A bit strange to me that the threshold for single filers is $200k but joint is only $250k. TaxAct also says my Taxable interest is $1,521 and my Ordinary dividends is $17,323.

A couple questions so I can validate the $602 is correct:
- how do I find our joint MAGI?
- Is the sum of the taxable interest and ordinary dividends above the NII?

4. My form 1095-C shows I had employer sponsored insurance all 12 months. the form says I paid $38.50 per month for insurance - do i report this?

5. I don't recall making estimated tax payments in 2019 but where can I verify this? having issues getting into my bank account online today

6. Are we supposed to file our FSA elections from 2019 somewhere?

7. Box 14 on W-2: it's for paid family leave - do we enter this amount under Mandatory State Disability Insurance (SDI) Contribution? or leave this field blank?

8. Wondering if we should make estimated tax payments in 2020. How should we begin to assess this? In 2020 we expect to have about 25% less income than in 2019.

Thanks
Aguilar

mhalley
Posts: 8299
Joined: Tue Nov 20, 2007 6:02 am

Re: Eight 2019 taxes questions - could use some guidance

Post by mhalley » Tue May 26, 2020 2:53 pm

Don’t know the answers to most questions but will take a stab at a couple:
You can look up your tax payments if you made them through the eftps system. I don’t think you can check them online if you just paid them online without setting up an account. I always print out a copy of my receipt when making my estimated payments.
Another option is to call the irs

https://ttlc.intuit.com/community/taxes ... /00/776427
You would need to contact IRS.
The number for individuals is 1-800-829-1040. For business returns, the number is 1-800-829-4933. Schedule C sole proprietors and 1099 contractors should call the individual taxpayer number. Agents can look up your payment history by Social Security number and even mail you a statement of all transactions for the relevant tax year.
https://finance.zacks.com/irs-estimated ... -3425.html
Whether you need to make estimated payments depends on the safe harbor rule.

https://www.key.com/personal/financial- ... yments.jsp

kaneohe
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Joined: Mon Sep 22, 2008 12:38 pm

Re: Eight 2019 taxes questions - could use some guidance

Post by kaneohe » Tue May 26, 2020 6:31 pm

2) How about going back to source 1099-DIV documents . Check in box 7 (foreign tax paid) and add those up.
If less than $600 don't file F1116 and just use the total determined as foreign tax paid.

3) https://www.irs.gov/taxtopics/tc559 for most, NIIT MAGI is simply AGI. If true for you then,
you need to determine if the limiting factor is your NII or the amount your AGI exceeds 250K. Pick the lesser of the 2 and apply the 3.8% to that. For me , it is always the latter.

4) https://support.taxslayer.com/hc/en-us/ ... Insurance- if you did not enroll in marketplace insurance,
this form is irrelevant.

5) https://www.irs.gov/payments/view-your-tax-account
Last edited by kaneohe on Tue May 26, 2020 6:47 pm, edited 1 time in total.

kaneohe
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Re: Eight 2019 taxes questions - could use some guidance

Post by kaneohe » Tue May 26, 2020 6:37 pm

8) https://www.mortgagecalculator.org/calc ... ulator.php
enter your expected income/deductions in a calculator like this to determine your tax. If your withholding will be 90% or more of your expected taxes, or the shortfall will be less than 1K, you don't need to pay estimated taxes.
If you do need to pay estimated taxes, it is simplest to pay in equal quarterly installments (currently both Q1/Q2 payments are due 7/15)

kaneohe
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Re: Eight 2019 taxes questions - could use some guidance

Post by kaneohe » Tue May 26, 2020 6:54 pm

1) is this stock from stock options, ESPP, RSU,or ????

7) https://support.taxslayer.com/hc/en-us/ ... o-I-enter- SDI is a common item here. I would not enter Family Leave under SDI. see if there is a more suitable code.........else likely it doesn't matter.

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grabiner
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Re: Eight 2019 taxes questions - could use some guidance

Post by grabiner » Tue May 26, 2020 8:25 pm

Aguilar wrote:
Tue May 26, 2020 2:21 pm
1. I have a form 1099-B from eTrade regarding some company stock that vested and I sold in 2019. In the Totals Summary in the 1099-B, the form says under Short term gains or losses that I have $36k in proceeds.This # is also listed under Realized gain or loss. This info is labeled Box B (basis not reported to IRS). Do I need to file this info? the 1099-B says Report on Form 8949, PART I but I've never seen a form like this before. It doesn't look like a typical 1099-B. My first year with eTrade. I do know my employer sold some of the vested shares to cover taxes before I got the rest of the shares in each vested allotment.
If you sold the stock, you do need to report it on a Form 8949. Box B means that the shares were non-covered, so the IRS knows the sale price but not the basis. (The basis might be wrong; in that case, you need to report the correct basis on your Form 8949.)
2. I paid $475 in foreign tax for international mutual funds in 2019. My wife didn't pay any. I read we don't need to file form 1116 but it sounds like it's better to do so, so I gave it a shot.
Unless you have carryovers, it is better not to file Form 1116 if you don't have to. You will get the entire foreign tax as a credit without Form 1116, and you don't need to go through the trouble of filling out the form.
The info for the 2 international mutual funds is correct in TaxAct, but there's also a section already populated for my Total Stock Market Admiral account, and it says $635 taxes withheld at the source on dividends in U.S. dollars. Is this info on VTSAX supposed to be filed? I thought only intl funds with foreign taxes paid would be included in this form.
Foreign tax withheld should have been reported on the 1099-DIV for each fund. TaxAct might have imported the 1099-B incorrectly, or you might have entered the number in the wrong place.
4. My form 1095-C shows I had employer sponsored insurance all 12 months. the form says I paid $38.50 per month for insurance - do i report this?
This doesn't need to be reported as such. As long as you had insurance, you don't have any Affordable Care Act penalties.
6. Are we supposed to file our FSA elections from 2019 somewhere?
Not on your federal tax. If your state doesn't allow deductions for FSAs, you might have to add this to your income, but that would already be done on the W-2 which would report higher state wages than federal wages. (If you file non-resident tax in another state, you might have to make the adjustment yourself.)
8. Wondering if we should make estimated tax payments in 2020. How should we begin to assess this? In 2020 we expect to have about 25% less income than in 2019.
If your withholding doesn't cover 90% of your tax (nor 110% of last year's tax, which won't happen in 2020), you need to pay more tax somehow. You can either file a new W-4 to increase your withholding, or make estimated tax payments. It's usually easier to increase your withholding. If 15 of the 26 pay periods during the year are still left, and you ask for $2600 more in withholding, you will have $100 more withheld from each paycheck and a total of $1500 more withholding.
Wiki David Grabiner

jjface
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Re: Eight 2019 taxes questions - could use some guidance

Post by jjface » Tue May 26, 2020 8:58 pm

You might want to get some professional help.

Topic Author
Aguilar
Posts: 50
Joined: Fri Jan 24, 2020 11:01 pm

Re: Eight 2019 taxes questions - could use some guidance

Post by Aguilar » Thu May 28, 2020 1:39 pm

grabiner wrote:
Tue May 26, 2020 8:25 pm
Aguilar wrote:
Tue May 26, 2020 2:21 pm
1. I have a form 1099-B from eTrade regarding some company stock that vested and I sold in 2019. In the Totals Summary in the 1099-B, the form says under Short term gains or losses that I have $36k in proceeds.This # is also listed under Realized gain or loss. This info is labeled Box B (basis not reported to IRS). Do I need to file this info? the 1099-B says Report on Form 8949, PART I but I've never seen a form like this before. It doesn't look like a typical 1099-B. My first year with eTrade. I do know my employer sold some of the vested shares to cover taxes before I got the rest of the shares in each vested allotment.
If you sold the stock, you do need to report it on a Form 8949. Box B means that the shares were non-covered, so the IRS knows the sale price but not the basis. (The basis might be wrong; in that case, you need to report the correct basis on your Form 8949.)
2. I paid $475 in foreign tax for international mutual funds in 2019. My wife didn't pay any. I read we don't need to file form 1116 but it sounds like it's better to do so, so I gave it a shot.
Unless you have carryovers, it is better not to file Form 1116 if you don't have to. You will get the entire foreign tax as a credit without Form 1116, and you don't need to go through the trouble of filling out the form.
The info for the 2 international mutual funds is correct in TaxAct, but there's also a section already populated for my Total Stock Market Admiral account, and it says $635 taxes withheld at the source on dividends in U.S. dollars. Is this info on VTSAX supposed to be filed? I thought only intl funds with foreign taxes paid would be included in this form.
Foreign tax withheld should have been reported on the 1099-DIV for each fund. TaxAct might have imported the 1099-B incorrectly, or you might have entered the number in the wrong place.
4. My form 1095-C shows I had employer sponsored insurance all 12 months. the form says I paid $38.50 per month for insurance - do i report this?
This doesn't need to be reported as such. As long as you had insurance, you don't have any Affordable Care Act penalties.
6. Are we supposed to file our FSA elections from 2019 somewhere?
Not on your federal tax. If your state doesn't allow deductions for FSAs, you might have to add this to your income, but that would already be done on the W-2 which would report higher state wages than federal wages. (If you file non-resident tax in another state, you might have to make the adjustment yourself.)
8. Wondering if we should make estimated tax payments in 2020. How should we begin to assess this? In 2020 we expect to have about 25% less income than in 2019.
If your withholding doesn't cover 90% of your tax (nor 110% of last year's tax, which won't happen in 2020), you need to pay more tax somehow. You can either file a new W-4 to increase your withholding, or make estimated tax payments. It's usually easier to increase your withholding. If 15 of the 26 pay periods during the year are still left, and you ask for $2600 more in withholding, you will have $100 more withheld from each paycheck and a total of $1500 more withholding.

Thanks for your help here, and to the others who chimed in. Everything is clear now. Just getting on the phone with TaxAct to figure out where I enter some of the info.

Topic Author
Aguilar
Posts: 50
Joined: Fri Jan 24, 2020 11:01 pm

Re: Eight 2019 taxes questions - could use some guidance

Post by Aguilar » Tue Jun 02, 2020 11:30 am

I received stock as part of my employment package. The employer sells off a portion of shares after they vest BEFORE making the remaining vested shares available to the employee. I thought that meant I didn't have any tax liability for the sale of the shares but maybe I'm mistaken. Anyone know the answer to this?

I'm in the process of my 2019 tax filing and TaxAct shows pretty significant federal and state taxes owed in large part because of the gains from my stock sales in 2019.

I got roughly $33k from the stock sales in 2019, and it appears that I'm being taxed about $10K as a result. Regular taxes plus the Net Investment Income Tax ($2K alone for this tax).

kaneohe
Posts: 6491
Joined: Mon Sep 22, 2008 12:38 pm

Re: Eight 2019 taxes questions - could use some guidance

Post by kaneohe » Tue Jun 02, 2020 5:30 pm

It is fairly common in stock plans that you either come up with the funds to pay your share/taxes or the plan can sell shares to pay those. If shares are sold, you would owe taxes on their sale.

lstone19
Posts: 755
Joined: Fri Nov 03, 2017 3:33 pm

Re: Eight 2019 taxes questions - could use some guidance

Post by lstone19 » Tue Jun 02, 2020 5:50 pm

Aguilar wrote:
Tue Jun 02, 2020 11:30 am
I received stock as part of my employment package. The employer sells off a portion of shares after they vest BEFORE making the remaining vested shares available to the employee. I thought that meant I didn't have any tax liability for the sale of the shares but maybe I'm mistaken. Anyone know the answer to this?

I'm in the process of my 2019 tax filing and TaxAct shows pretty significant federal and state taxes owed in large part because of the gains from my stock sales in 2019.

I got roughly $33k from the stock sales in 2019, and it appears that I'm being taxed about $10K as a result. Regular taxes plus the Net Investment Income Tax ($2K alone for this tax).
Your employer sold some of the shares to cover the WITHHOLDING on your stock. The amounts withheld will be included on your W-2. You still need to show the income resulting from the stock. However, with employer stock, often the basis the brokerage reports (when reporting basis which appears not to be true here) is incorrect as they are not legally allowed to report any part of the basis that is also compensation income and reported on your W-2.

I'm most familiar with this from an ESPP (my wife's employer) that gives a 15% discount on the employer stock. Let's say on the exercise date, the price is $10.00 which means she can purchase for $8.50/share. Under the circumstance she always sell (a disqualifying disposition), the $1.50 difference is compensation income and reported on the W-2. But because all the brokerage was paid was $8.50, that is what they have to report as the basis. The additional $1.50 per share, already included as income on the W-2, is accounted for by making a basis adjustment.

I don't know your circumstances of your plan but with hers, also handled by E*Trade, information on the amount of the basis adjustment is included on a supplemental page after the 1099-B. But if you're finding you owe more in taxes than you expect, make sure you're reporting the correct basis and make sure any taxes withheld made it to your W-2.

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